Driven by rapid global digitalisation, and aided by emphatic support from the Indian government through the likes of the Digital India Scheme, India’s information, communication, and technology (ICT) sector contributes about 13% to India’s GDP. According to Nasscom (India’s National Association of Software and Service Companies), India aims to grow the ICT sector to $1 trillion by 2025, or 20% of predicted GDP. By 2025, the value of the industry to India’s GDP is projected to reach $19.93 billion, according to pan-Asian professional services firm Dezan Shira and Associates.
The Digital India Scheme, which was launched in 2015 as a key policy of Prime Minister Narendra Modi, aims to drive digital technology uptake across society and build the innovation and infrastructure needed to support e-government. It is a far-reaching vision that leans heavily on the expertise inherent in the Indian ICT sector – and which has multiple tendrils into South Africa.
Indian ICT in Africa
Since the early 2000s, big Indian ICT companies such as LTIMindtree, Tata Consultancy Services, Infosys, Wipro, Bharti Airtel, and Essar have been putting down roots in Africa. South African businesses have grown in step with India’s burgeoning ICT sector, benefitting from world-class IT solutions at cost-effective prices, believes Prabhat Kumar, the Indian High Commissioner to South Africa. As a result, he says, “The Indian IT space is very big. Indian companies have a good presence in South Africa – all our IT majors have some presence.”
LTIMindtree, a digital system integration company headquartered in India, has a presence in more than 30 countries, including South Africa. LTIMindtree South Africa’s country head, Gaba Tabane, explains that the company is part of the mega business conglomerate Larsen & Toubro, which spans IT, financial services, construction, and real estate. “LTIMindtree started its South Africa operations in 2006. In these 18 years, we have grown from a small footprint to 1 500+ experts serving our South African customers from multiple locations across South Africa and India,” says Tabane.
Other notable Indian IT companies in South Africa include Zensar Technologies and HCL Technologies. In 2024, Zensar was named as South Africa’s top employer for the third year in a row while HCL Technologies, which first established itself in Cape Town in 2009, services African, European and US clients from its global delivery centre in Johannesburg.
In 2021, HCL’s head of Europe, the Middle East, and Africa (EMEA), Ashish Kumar Gupta, commented in a Forbes Africa article, “South Africa is a nation we believe in and we’re here for the long term. We are convinced that the appetite for true partners in technology will only increase as the local IT sector expands. I’m very optimistic about South Africa and HCL’s part in its future.”
Similarly, LTIMindtree also supports customers across Africa, and some in Europe, via its 300-seater Johannesburg delivery centre. For this reason, the company’s principal director, Ashutosh Tripathi, notes that “South Africa is a key revenue contributing country [and] South Africa and the larger African market is a major focus area for LTIMindtree”. It is for this reason that LTIMindtree is actively working to attract talent across the country, having recently opened a new office in Durban to “create opportunities beyond Gauteng and attract youth talent in KwaZulu-Natal province”.
Tripathi adds that the company is also expanding into East Africa, with a new office due to open in Nairobi, Kenya.
Africa: Front and centre
For LTIMindtree’s head of Africa engagements, Srinivasan V (Srini), this physical move into Kenya underlines the importance attached to working with African customers across banking, insurance, the public sector, financial services, and retail to help them affect widespread digital transformation.
In terms of recent successes, he cites LTIMindtree’s work with a prominent pan-African bank, which required managing more than 16 platinum category programmes across legacy systems and new age technologies. “We have also helped a South Africa-based insurance company to bring higher efficiency to their operations using the power of automation and technology. We have also helped a large South African municipality in implementing solutions around governance risk and compliance.
Notably, Srini explains that LTIMindtree’s approach includes traditional technologies alongside cutting-edge new solutions such as artificial intelligence, cloud, and cybersecurity. This is an approach that recognises the individuality of each corporation’s digital journey and that also opens doors for potential collaboration, he believes. “India and South Africa can jointly build and curate incubation and innovation labs in either of the locations (depending on sweet spots within each country) with joint participation leading to closer cooperation, accelerated outcomes, and success,” he says.
This kind of co-operation would position South African ICT players well as India continues to develop global capability centres (GCCs) for international companies. Already, Kumar explains that about 25% of Fortune 500 companies use a GCC in India and, increasingly, smaller firms are also looking to enhance their offerings by using India’s offshore IT solutions.
A global centre for corporate IT solutions
According to CBRE research, GCCs have grown steadily in India since the 1990s and today they are regarded as hubs for innovation and excellence. “From merely providing voice-based services in the 2000s to now driving innovation, digital transformation, and product excellence, GCCs are now an integral part of any futuristic global firm,” said the firm. “While the initial benefits stemmed from lower costs in India, GCCs are now reaping the benefits of a wide and deep-skilled technology workforce, besides a well-developed technology and startup ecosystem. GCCs contribute to about 1% of India’s gross domestic product.”
Kumar notes that the flows aren’t all in one direction, and that some South African IT companies are also opening small setups in India or offshore development centres.
While currently India remains the senior partner in the ICT space, prominent South African CEOs such as Phuti Mahanyele from global technology investment group Naspers see the closeness of the India-South Africa business relationship as a boon for both countries. Speaking at an event in March 2024, Mahanyele commented that Naspers was heavily invested in India, which it regarded as a “high-focus country”.
“India and South Africa are at the forefront of technological advancement and digital transformation and jointly harnessing the power of technology,” said Mahanyele. “We can drive efficiencies and create new areas for businesses across our economies.”
Unlocking opportunities
By building on existing close-knit ties to capitalise on these opportunities, it is hoped that South Africa can also unlock the positives associated with widespread digitalisation for its own people and economy. To extract the utmost from this relationship, however, removing existing barriers to business is a must. LTIMindtree’s Srini believes that greater attention should be paid to making business easier through simpler policy and regulatory requirements. Upskilling and supporting entrepreneurial culture would also open more doors for the IT sector, he says.
LTIMindtree is doing its bit by “investing heavily to build talent within country” through training internships and offering hands-on experience for graduates, thus building a sustainable talent pool, says Srini. However, the “simplification of work visa processing for highly skilled areas would enable South Africa to access on-demand talent quicker. This will revitalise the economy faster and enable industry sectors to revive – thereby addressing unemployment issues on macroeconomic levels.”
Everyone wants to see South Africa flourish, adds Srini. “South Africa is a nation built on a robust constitutional framework, rich culture, and passion for human values. South Africa is also blessed with abundant natural resources, and warm and friendly people; this attracts not just tourists but continues to make South Africa the gateway to Africa.”
Expanding Infotech
ITC Infotech is a wholly owned subsidiary of its eponymous US $10-billion parent. It established its presence in South Africa in 2010 and has steadily expanded operations across the region. Over the years, ITC has witnessed firsthand the evolution of South Africa into a very attractive destination for IT service delivery, both for its clients in the region, as well as their global clients.
Prasad Kotikela, country manager of ITC Infotech, says: “We are investing in building significantly differentiated value propositions and are exploring partnership opportunities to nurture niche startups in the areas of AI, the digital workplace, automated application management services, and moving monolith to microservices. We are strengthening our expertise in these cutting-edge technologies with a layer of deep industry domain knowledge, to provide clients with business-friendly solutions. To this effect, we have opened up local delivery centres for our global clients here in Johannesburg. Additionally, over time, we continue to expand our presence in Cape Town, which will bring us even closer to our clients in the region.”
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