Vic Govt: $20m investment will reverse offshoring

Stan Beer
Thursday, 03 November 2005 11:00

IT Industry - Market

A new $20 million intellectual property deal will reverse the offshoring trend and provide a major boost to the Victorian ICT industry, according to the state's ICT Minister Marsha Thomson.

According to the Government, Value Chain Integration (VCI), a Melbourne-based IT company, has transferred ownership of software intellectual property (IP) rights, valued at $20 million, from India to Melbourne, where the company plans to build its new global headquarters.

"This deal is a major win for India's ICT industry and is the first major deal of its kind which sees the transfer of technology ownership from India to Australia," Ms Thomson said.

"This cements trade ties and paves the way for future deals and technology transfer between the two counties.

"It is also testimony to the quality of India's R&D capabilities and ability to develop market leading technology solutions."

The IP rights, which are for service collaboration technology, will be owned and marketed by VCI, with the company making commitments to invest big money in Victoria, including the establishment of global headquarters in Melbourne.

VCI CEO Ananda Rao, who founded the Australian office of Infosys, said VCI intended to become a dominant global player and would leverage Australia’s ICT talent.

"VCI will be investing $8.1 million into establishing its global headquarters in Melbourne and plans to be turning around $132 million within five years, staffing in excess of 500 employees world-wide, with up to 100 highly skilled jobs in Melbourne," Mr Rao said.

"Victoria will be the major centre for marketing, solutions development and product design enhancements with at least 40 per cent of all effort and 60 per cent of monies spent to come out of Australia."

Ms Thomson said trade between Victoria and India had been growing steadily to reach more than AUD$600 million in 2003-04.

Ms Thomson is currently leading a delegation of 25 Victorian ICT companies, including VCI, to BangaloreIT.in - Asia's largest ICT trade fair, where she has also announced the establishment of a Victorian Government business office in Bangalore.