A recent survey by NASSCOM has found that the total volume of e-commerce transactions in India during the fiscal year, 1999-2000, was valued at Rs 450 crores. NASSCOM has described the performance of the B2B players as
"impressive" against the background of the almost non-existent regulatory system and "not-so-conducive" infrastructural framework.

The gamut of B2B electronic commerce transactions includes, among other things, customer relationship management, supply chain management and business intelligence through data warehousing and even virtual enterprises. The key to all this is the fact that the net facilitates quick and efficient flow of authentic information. It thus enables the supplier to improve the quality of his services.

These are extremely crucial issues. In the forthcoming WTO regime, Indian players will come face-to-face with multinational competitors. To survive in this scenario, domestic businesses must initiate sweeping changes in the traditional method of doing business, explore ways and means of reducing expenses and cutting corners. E-business will equip them to undertake these operations.

But there is still a long way to go. For those who are pioneering B2B transactions in this country, the obstacles are many and varied. Setting up an e-business portal is a cost intensive proposition that presupposes strong infrastructural support. In India, infrastructure poses a serious challenge. With the power sector in complete disarray, the entire IT industry, like every other business, is teetering on the brink of an abyss. To combat this crisis, organised planning is required—and India has never been very strong on this front.

The government has invited the Indian industry to set up a certification authority that would enable them to function without any degree of governmental intervention. However, the response has been lukewarm. Indians are extremely wary about experimenting with new processes of transaction, as our weak legal system limits their options to retaliate in case of a fraud.

But all these problems notwithstanding, it will be unwise for an Indian corporation to ignore the potential of the e-commerce market in India. For the possibilities are indeed mind-boggling. As per NASSCOM projections, e-business transactions in India are expected to reach Rs 10,000 crores in 2001-2002. Again, a NASSCOM-McKinsey study in 1999 has predicted that India will earn revenues of about US$ 10 billion from e-business solutions by 2008. So gaining a strong foothold in this arena is definitely needed.

MK Chandrasekharan
is the CTO, Commerce One India Distributor Operations