In the post-pandemic economy, the rate at which organizations embrace digital transformation has accelerated rapidly. Across industries, companies are focused on strengthening their digital prowess in operations, customer experience, and employee experience for greater resilience and growth. IDC predicts the spending on digital transformation in META countries is estimated to grow at a CAGR of 16.6% from 2021 to 2025, topping at $58 billion in 2025.
The UAE is a case in point. Over the last few years, there has been accelerated UAE digital transformation and adoption of cutting-edge technologies across the private and public sectors. Reimagining and rewiring their operations to enhance citizen services and raise governance standards is a focus area.
The CEPA opportunity
One of the recent developments that can act as a significant tailwind to the UAE's digital innovation agenda is the newly implemented Comprehensive Economic Partnership Agreement (CEPA) between UAE and India.
The CEPA UAE aims to increase the non-oil trade between the two countries to $100 billion in five years from $45 billion in 2021. Sector-specific programs are launching, and India's exports to the UAE are already up by 16%+ within the first two months after CEPA came into force on May 1, 2022.
CEPA is more than just an economic partnership – it catapults the UAE-India relationship to completely different strategic and trust levels.
However, CEPA is more than just an economic partnership – it catapults the UAE-India relationship to completely different strategic and trust levels. It is the first such deep and comprehensive Free Trade Agreement signed by India with any country in the past decade. Given that the UAE has a robust technology and innovation agenda and technology is a critical pillar of CEPA, such an exponential trade growth plan will have a domino effect on the technology demand. CEPA can play a crucial role in harnessing the potential of Indian IT prowess to advance the UAE's technology agenda.
CEPA can help forge fluid, profitable partnerships – leading to fast-tracked digital transformation efforts that unlock innovation for business resilience and scale. The Agreement categorically acknowledges the opportunity for enterprises across industries to benefit from digital trade and contribute to a digital economy. The fact that the digital economy has received particular attention in the CEPA demonstrates that negotiators have considered and made provisions for future requirements arising from the societal shift towards automation and digital trade.
Partnering with the right talent is crucial.
Enabled by emerging technologies, digital transformation relies heavily on people with the right capabilities for effective, high-impact deployment. However, the massive shortage of skilled IT talent is delaying projects across geographies, including the UAE.
The Indian IT industry offers immense partnership potential for UAE-based organizations in this context. Having established itself as a global IT powerhouse, Indian software companies now occupy key positions in the global IT market. Exposure to large-scale data, complex business challenges owing to a vast domestic consumer base, and a fast-growing economy has created a well-exposed talent pool. The Government of India's flagship program – Digital India – and significant investments in critical technologies such as AI, quantum technology, and ML further strengthen an ecosystem that is transforming and leading the global digital transformation market. All these efforts have led to India becoming the world's leading IT sourcing destination – the home of an IT sector that is expected to rise to USD 227 billion in FY'22, representing the most significant growth rate in over a decade.
For the UAE-based IT businesses offering digital transformation solutions and services to clients across industries, this is an excellent opportunity to collaborate with partners with proven capabilities. India's technological competence – especially its proven capabilities in Industry 4.0 technologies – can enable the UAE's tech companies to accelerate business transformation and growth. Thus, the UAE's business leaders must engage India-based organizations with the right talent and tech capabilities to maximize the CEPA advantage.
Collaborating for success
As a global industry leader headquartered in India, HCLTech is a preferred business transformation partner with world-class digital innovation capabilities. A vast talent pool – 200,000+ consultants – along with an unrelenting focus on skilling and training, and a culture that shapes 'ideapreneurs' sets apart HCLTech in the current talent-scarce industry. Our innovation centers and a client portfolio that includes 250 of the world's Fortune 500 companies offer talent with the requisite exposure for customer-ready competencies. Our collaboration-focused approach with all stakeholders translates into successfully delivering specific business competencies and goals.
Over the years, we have built a robust platform with a local presence that helps us deliver valuable engagements within the META region, leveraging our local and global delivery models. Over the last few years, HCLTech has refocused its efforts on the UAE market by significantly growing its regional teams and investing in operations in the region, becoming one of the fastest-growing IT service providers in the UAE. Our renewed focus and Invest-First philosophy have helped us become strategic partners to some of the most prominent organizations in the UAE. HCLTech UAE continues the positioning as a transformation-centric partner with a skin-in-the-game approach to delivering business outcomes.
Unlocking a future focused on agility and scale
The context for innovation, business-focused engineering, and capabilities for continuous strategic transformation will remain keys to riding on the current momentum offered by the UAE and Indian governments. While speed is critical to successful digital adoption and change, such initiatives' effectiveness dramatically relies on velocity. In geographies that have witnessed digital transformation projects on a large scale, a lack of alignment to the bigger picture is one of the leading reasons that such projects fail. Hence, while leveraging the CEPA opportunity, it is critical that stakeholders collaborate with transformation partners who help define clear goals and strategies before deploying frameworks and solutions. Lastly, prioritizing partners with a keen understanding of end-consumer markets, everyday work ethics and time zones, and competitive pricing can go a long way in kickstarting effective digital transformation.