Romania's booming IT sector

Romania looms as the next offshore tech powerhouse with its low costs, language proficiency, burgeoning infrastructure, and engineering skills

Could Romania be the next India for IT talent? Business-technology leaders in the former eastern European country hope so.

A delegation of business and technology executives from 26 Romanian companies recently exhibited at an outsourcing expo in New York to rally business from U.S. and international companies looking for offshore tech help.
Dozens of U.S. and other companies already are working with Romanian developers, including Microsoft, whose RAV AntiVirus software was developed by GeCAD Group, a coalition of five Romanian software and IT-services firms.

The average annual income for software developers in Romania is about $6,000, says Constin Lianu, general director for export promotion at the Romanian Ministry of Economy and Commerce, almost double the $3,300 average per-capita income. Software pros working for multinationals can bring in much higher paychecks. Developers working for Oracle earn the equivalent of $15,000 to $35,000 U.S., says Edund Fabian, senior development manager of Oracle’s European Development Center, which opened last year in Bucharest and employs about 300, including Fabian, who leads a development team of 10. Romania has about 45,000 software developers, and 8,000 graduates enter the field annually.

There are about 45,000 software developers in Romania and 8,000 graduates enter the field annually, Lianu says. The government is intent on expanding the ranks of IT pros, providing perks such as payroll tax exemptions. Romania is a relatively poor country, but that’s changing, Fabian says. Long plagued by political corruption, it’s cleaning up its act and is expected to join the European Union in 2007, he says. Even under Communist rule, Romanians were known for engineering skills, but in recent years many professionals left to work elsewhere. Fabian, who is 30, himself is one of the increasing number of IT pros returning. He spent seven years working in software development jobs in Ireland and The Netherlands.

Accessible Technology
To help nurture the growth of its technology industry, Romania is also developing its IT infrastructure, with broadband rollouts in rural areas and a multimillion-dollar program to subsidize the purchases of PCs for families.
Besides the cheaper labor costs, one of the biggest advantages Romania has is its multilingual workforce. Most Romanian IT professionals speak English, and many also speak French, German, Swedish, Finnish, Greek, Danish and other languages.

Disaster-recovery-software company Neverfail Group Ltd. was struck by workers’ language abilities when it chose to open a tech-support office in Cluj-Napoca, Romania, says Martin Procter, a product and services director at Neverfail. The center employs 18 IT pros who provide tech support for the company’s software. Neverfail, which also has a support center in Scotland, had investigated opening a support center in India, “which won on cost,” Procter says. However, in the end, Romanians’ strong “understanding of English” and other multilingual skills won over India’s lower costs. Procter says, “We were looking for clever young people” who had good tech skills but were not yet “programmed” or trained for a particular industry, business, or company.

Indo-Romanian trade to increase one billion dollars by 2008: Envoy

India and Romania have set a target of one billion dollars in bilateral trade in the next two years, said Romanian Ambassador Vasile Sofineti at a meeting with the economic delegation from Romania organized by the Confederation of Indian Industry (CII) here on Tuesday. Trade has witnessed a quantum growth to around 450 million dollars in 2005, an increase of 69 percent over the previous year. This should become possible by collaborating with incredible India, Sofineti added. Chairman and Managing Director, Inapex Ltd, V K Mathur said India- Romania trade, which stagnated during 1999- 2001, is again on the upswing. In 2004, trade between the two countries grew by an impressive 103 percent as compared to 2003. Some of the items with good potential are drugs and pharmaceuticals, iron ore, machinery and instruments, iron and steel and inorganic chemicals. "We have the capabilities and capacities to diversify our trade basket to include non-traditional niche products." Many Indian companies such as Ranbaxy, Viraj Group, Ashmita Constructions have set up businesses in Romania, he said. "Till now, about 20 Indian companies have registered in Romania." Mathur said there is no dearth of new avenues in which Romanian businesses can cooperate with their Indian counterparts for trade and investment in India. New areas where both the countries can work together for mutual benefit include new frontiers such as information technology, entertainment, biotechnology and bioinformatics. There are new opportunities for investment in India in sectors as diverse as tourism and infrastructure, petrochemicals and aviation, mining and oil exploration, he said. The special economic zones recently set up in several Indian states provide internationally competitive business environment. "The Romanian industry can seriously consider the opportunities to invest in these zones and benefit from the preferential policies of the Indian government." Counselor Asia Division, Ministry of Economy and Commerce, Romania, Mr. Dorin Refca said India is considered among the top four strategic partners in Asia. The relationship between the two countries has been further strengthened with the recent visit of Traian Basescu, President of Romania in October this year. "Quite a lot of events are lined up next year in order to enhance trade between the two countries," Dorin said. Vice President, UGIR 1903, Elena Laslu said that the organization looks forward to make an agreement with CII. "We have many associations for industrial sectors in Romania to help our Indian counterparts." The meeting was followed by business to business meetings between the 16 member Romanian business delegation and members of the Indian industry. (ANI)

MSL to buy Romania-based seamless plant

Maharashtra Seamless (MSL) - a flagship company of the Rs 3,000 crore turnover DP Jindal Group - announced that the parent company is acquiring Romania-based seamless plant with a capacity of 2,00,000 TPA.

The acquisition is expected to surge at further heights in view of increased prices of oil and also increasing demand for energy requirements. This would enable the group to capture the maximum demand potential going forward and would lead to substantial growth in the businesses of MSL.

The group is well diversified into manufacturing of Seamless Pipes, ERW Pipes, Wind Power Generation, Offshore Oil & Gas Drilling and projects exports. The group is also having a Joint Venture with Tenaris, the largest manufacturer of Seamless Pipes in the world and also having a marketing collaboration with Noble Drilling, US, the second largest drilling company of the world, for Indian operations.