1. Presentation by:- Ajoyendra Mukherjee Vice President, TCS Cross-Border Supply of IT Services A Private Sector Perspective www.tcs.com WTO Cross-Border Supply Symposium 28 April 2005 Geneva

2. Agenda Indian IT Industry Cross-Border Service Delivery Opportunities – As Supplier & Consumer Challenges Conclusion

3. Application Development & Maintenance IT Enabled Services IT Infrastructure Management Engineering, R&D Indian IT Industry Services Spectrum

4. Indian IT Industry Source: NASSCOM, Strategic Review 2005 Includes IT Services & Software, ITES-BPO and Hardware

5. Indian IT Industry - Exports Source: NASSCOM, Strategic Review 2005 Includes IT Services & Software, ITES-BPO and Hardware

6. Indian IT Export Destinations Source: NASSCOM, Strategic Review 2004 Excludes hardware exports

7. Cross Border Service Providers Source: neoIT, NASSCOM Estimated Value of Offshore Sourcing (US $ M) – CY 2004 India - the largest Cross-border IT Services Provider

8. TCS – Largest Indian IT Service Provider Created Indian IT Industry and have led it since 1968 Operate in 47 countries 33 Delivery Centers - 15 in India, 18 Overseas Growing at a rate of > 40% annually Global Employee Strength of 43000+ 60% Revenue from North America, 23% from Europe Enterprise wide CMMi, PCMM L5

9. Agenda Indian IT Industry Cross-Border Service Delivery Opportunities – As Supplier & Consumer Challenges Conclusion

10. Cross-Border Service Delivery – Genesis Movement of Natural Persons TCS Office, India 1970s Client Office, Onsite Small, dedicated team stationed at client site Development Maintenance Testing Support

11. 1980s Cross-Border Service Delivery – Genesis Commercial Presence Presence Movement of Natural Persons TCS Office, India Client Office, Onsite TCS Office Office Setup in the same country as client Sales & Marketing Account management

12. 1990s Cross-Border Service Delivery – Genesis Cross Border Supply Commercial Presence Presence Movement of Natural Persons TCS Office, India Client Office, Onsite TCS Office Remote Service Delivery (Offshore) Design & Coding Testing Documentation Maintenance

13. TCS Office, India 2000+ Cross-Border Service Delivery – Genesis Client Office, Onsite TCS Office Commercial Presence Presence Movement of Natural Persons Multi Cross Border Supply TCS GDC Local Recruits Delivery Centers across the globe to establish a near-shore presence

14. Movement of natural persons Dedicated team stationed at client site & People moving between Vendor offices in different Countries Commercial Presence Global Delivery Centers setup to address regulatory & language requirements, 24x7 service delivery windows, BCP & DR Cross Border Supply Offshore Delivery Centers established in India to service overseas customers remotely with a cost- effective, scalable model Consumption Abroad People sent overseas for specialized Training Cross-Border Service Delivery – Summary

15. Agenda Indian IT Industry Cross-Border Service Delivery Opportunities – As Supplier & Consumer Challenges Conclusion

16. Opportunities – As Consumer Cost Saving High Quality Faster Time to Market 24 Hour Service Window Better Utilization of Internal Workforce Address Aging Demographics of Western economies

17. Opportunities – As Supplier Source: NASSCOM, McKinsey Report, 2002 Category$ Billion IT Services Exports28-30 ITES Exports21-24 Product and Technology Services8-11 Domestic Market13-15 Total70-80 Potential for Indian IT Industry by 2008 By 2008, IT and ITES Services will generate an employment for 1.1 M and 1 M respectively In addition the Parallel Support Services will create employment for another 2 M people

18. Agenda Indian IT Industry Cross-Border Service Delivery Opportunities – As Supplier & Consumer Challenges Conclusion

19. Challenges – Movement of Natural Persons Immigration & Visa Issues Universal Recognition of Qualifications, Experience and Training Employment laws enforcing local hiring directly or indirectly e.g. USA (recruitment attestation / displacement attestation), UK (TUPE) Wage Parity Insisted upon Social Security Tax Tax Withholding

20. Challenges – Commercial Presence Structure of Entity (Branch, JV, Fully owned Subsidiary etc.) Restrictions on Foreign Investments & Local equity participations Remittance of foreign exchange Staffing & Management conditions Restricted Access to certain market segments based on the structure

21. Challenges – Cross-Border Supply Data Security / Data Protection IP Protection & Software Piracy Language & Cultural Differences Deduction of Withholding Tax Double Taxation Geo-political Stability & Government support Offshore Management

22. Agenda Indian IT Industry Cross-Border Service Delivery Opportunities – As Supplier & Consumer Challenges Conclusion

23. Conclusion Cross-Border IT Services is a growing necessity and opportunity Visa & Immigration, Taxation, Protectionist Law and Uniformity in Qualification are some of the key challenges still faced by a service provider like us… A uniform GATS framework and commitment will provide the right impetus to the growth of Cross-Border IT Services