By Sourabh Sarkar
Amidst the troubled political atmosphere, the IT business in Jammu has been going flat. With stagnant growth in the IT industry and lowering profits, enterprises are not showing interest in investing in Jammu. Largely, the Jammu IT market is dependent on the government and retail business. Of which, the government has been the biggest buyer of IT products. Since Government e-Marketplace (GeM) was introduced, the local partners of Jammu feel the government business has come down to 50 per cent.
GeM is an online market platform to facilitate procurement of goods and services by various ministries and government agencies. Although the portal has its advantages, SMBs are finding it tough to list on the portal due to lack of experience. The current structure also requires companies to rely on rate contracts that maybe a few years old and seeks further discounts on those prices.
“We can’t compete for pricing on GeM portal. In earlier times, we used to have healthy annual order business from the government, but with GeM, the same business has been reduced to half. The pricing in GeM is obnoxiously low only large volume partners can meet the pricing criteria. Moreover, the system has no minimum guarantee of government procuring goods locally. Today, the market is flooded with Chinese and cheap products. The sustenance of local partners is getting challenging day-by-day,” says Arvind Kaul, one of the veteran IT partners in the city.
The servicing and AMC business in government has been curtailed, which used to give healthy margins to partners. IT industry is considered an important business and it is a Rs 500-600 crore worth market in Jammu. Similarly, on the retail business front, the offline business has been taken over by online marketplace like Flipkart and Amazon. The removal of entry tax after the GST rollout has further paved the way for neighboring partners to operate and sell products.
While the local IT business lacks government support, the city is witnessing steady growth in the emergence of start-ups culture in the city. In recent times, they have been facing growth challenges in the city. Corresponding to this, the members of various start-up firms have united to form Jammu Start-up Community to assist the start-ups and small businesses.
Ankush Jain and Kanav Gupta, CEO, Zonixsoft, and a member of the start-up community, says, “We started with just four members in 2017 and now it has expanded to over 100 members. Our basic function includes providing suggestions to various young entrepreneurs regarding their business strategies. We do not provide any financial help directly, but we help the start-ups tie-up with investors from where they get monetary help. Start-ups here are emerging in various sectors including IT, healthcare, textiles, etc.”
Speaking on behalf of the local association Naveen Gupta, President, Jammu Computer Dealers Association (JCDA), comments, “The IT market in Jammu is in the doldrums. Barring a few big partners, the business of small and mid-sized partners is slow and sluggish. In the absence of a stable government, the sentiments of the market are on an all-time low. It is essential to have government initiatives to keep the IT market spirited.”
Kaul states, “We want to discuss our business challenges and apprised to the government as soon as the formation of the government shapes up.”
Vikas Baru, Managing Partner, Black Cap IT, a web design expert located at the software IT park in Jammu, adds, “The IT industry is stagnant. Various companies are shifting to metro cities to seek better opportunities and assistance from the government and the new companies are finding it difficult to sustain.”