Is protectionism ever a good idea in IT?


News in the Financial Times today has shown that the Indian trade minister, Kamal Nath, and others in New Delhi are unsurprisingly unhappy about new UK legislation making it harder for India and other developing countries to export IT systems to the UK.

India exports about $40 billion (£20 billion) of software and business processing exports each year.

I think that it is important to investigate Britain's motives and whether they are correct. The aim of this legislation is to control immigration rather than protect the British IT industry. It will affect it, but does it protect it? Doesn’t common sense dictate that protectionism is a sensible step?

Ask yourself: does the UK have enough resource to adopt such a protectionist mentality? Recent research from industry skills body e-skills UK has found that IT students have fallen 50 percent in the last five years. The lack of skilled UK IT staff means that 140,000 new recruits need to be found in order to satisfy demand. S

So, we don’t have enough up-and-coming IT resource in the UK. However, instead of taking this resource from the increasingly globalised IT market, we seem to be putting up barriers. Is Britain biting off its nose to spite its face? Is this a repeat of the protectionism of the past, such as semi-conductors and ship building?

Well, I think the answer is that it is not meant to be such a repeat, but the IT industry could be dangerously affected. So the sooner British management learns to take advantage of other countries' skills, the better, and many organisations have done this through outsourcing.

Outsourcing might be a dirty word to some, but if we can't have the resources here, we need our people to be developed so they can manage resources outside the UK. Outsourcing and outsourcing best practice could be the key determinant and be the difference that makes one organisation competitive and another a disaster!

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