First Tech
GAUTAM Patel owns a company that makes copper compression products, which are an integral part of any broadband electrical cabling and circuitry. But talk to him, and he would turn out to be an expert on e-business.

The chairman of the Ahmadabad- based Sigma Corporation goes ga -ga over the utility of the Internet. And why not? Within three years since he set up the company, he has generated huge exports of his products, so much so, Sigma was recently conferred a national 'Emerging Exporter' award for 2006-07. All his transactions are conducted through the Net.

Sigma is among several thousands of small companies in India that is are using the Internet as a jumping board to success. Trade through online business portals in the country is growing 60% year-on-year. During fiscal 2006-07, the country witnessed a whopping Rs 2,300 Crore worth national e-business, says the Mumbai-based Internet Mobile Association of India (IMAI), a body which advocates the use of Internet for business. IMAI has projected that India's on- line business will touch Rs 3,000 Crore by the end of the current fiscal. What's startling is the fact that nearly 70-80% of this will be contributed by SMEs.

In a competitive environment, where manufacturers are being compelled by their clients to take a cut on margins, e- commerce has come as a boon. "Doing business through the Net means no middleman is involved. You actually save costs by doing away with him," says Patel. Patel has also found that the time taken to clinch a deal gets reduced when it is done on the Net.

The rise in e-commerce has promoted a bunch of online trade sites. Portals such as tradeindia.com and indiamart.com do not just offer database of the Indian SME sector comprising manufacturers, exporters, importer and service providers, they also offer companies the platform to conduct their businesses through the Net. Currently, around 2- 3lakhs Indian SMEs are registered on both indiamart.romandtradeindia.com. The numbers have tripled in the last two years.

Says indiamart.com's managing director Dinesh Agarwal: "Though the, share of online trade is minuscule in the national and international trade basket, most companies, on an average, use on- line market places for 15-20% of their overall business.”

Bikky Khosla, chief executive of tradeindia.com, says, "Even as the rate of change of technology has accelerated the pace of use of these technology in businesses at the bottom of the pyramid has not increased significantly. Certain challenges including, limited Internet penetration and Net quality still haunts the SMEs sector.

Findings show that Indian SMEs are expected to invest $1.2 billion in Internet infrastructure and solutions in 2007, against $1 billion spent in 2006. Industry estimates also suggest that of over 5 lakh SMEs, only 50,000 are actively using business portals. Another 21akh are just registered with various portals and are yet to invest serious time and money ,on marketing. The portion of people doing international business is about 50% and the rest are planning to enter the international business.

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