Rising costs in major cities a big concern: Infosys

Editor's note: With the annual sessions of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference ending with a call to adapt to "new normal", chinadaily.com.cn sat down with global business leaders to get their views on the reform process and lowering of the growth target.

Here are the excerpts of Rangarajan Vellamore Rathangapani, Infosys China President.

Rangarajan Vellamore Rathangapani

What impressed you the most about the annual Government Work Report released during the ongoing two sessions of China’s top legislative and advisory bodies in Beijing? What do you think was the most important issue raised by the government in this report compared with the previous sessions?

What impressed me most is that the leadership in China has acknowledged the issues and challenges for economic growth. They have also stated a clear plan to address the structural issues in the group. They have set a lower target for the GDP and have focused on increasing domestic demand and quality of life by reducing pollution and boosting energy conservation.

In the Government Work Report, Premier Li Keqiang said that the nation’s economic growth rate would be adjusted to 7 percent. Do you think your company should adjust its development strategy in China?

The current strategy still emphasizes on modernization, efficiency and innovation. This means that technology and systems will continue to be in demand. Hence there will not be any significant reduction in the IT services opportunities for companies like Infosys. However, it is equally important that we invest in innovation and in bringing new solutions to China.

Amid the global economic slowdown, especially in developed economies, and China’s economic adjustment, what is your greatest concern about your company’s operations in China?

China is a strategic market for Infosys. We have been investing in China for more than a decade now. Our focus is continue to build high quality talent to deliver superior solutions and services to clients. In this context, one the concerns that we continue to have is about the rising costs which is due to the higher living costs in major cities. While the government has been taking a lot of steps to control inflation, the labor costs continue to rise in most of the major cities.

Which aspect of China’s social and economic reforms should be improved in order to enhance the investment environment to attract more foreign companies?

While the government has made its intentions clear about policies that would welcome foreign companies, foreign investment and innovation, there is also a perception that State-owned enterprises have been asked to champion Chinese industry. If a level playing ground for all companies can be created in a transparent manner, then the investment environment for foreign companies will improve further.

Do you think your company will develop faster in China than the previous year in terms of growth rate or market penetration?

5) Certainly! We have been working hard to achieve better growth rate and market penetration in China. I am confident that the foundation we have laid here will help us to achieve the same in future.