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New Year Special Features '99

  • Y2K Awareness Rising Among Organizations in India
  • January 8, 1999 (MUMBAI, India) -- With less than 12 months remaining in this year, the awareness about the Year 2000 (Y2K) problem has started dawning on major Indian organizations.
    Companies are initiating action to become Y2K compliant. Many companies had believed that India did not have major Y2K problems because of the widespread use of UNIX and its low computer penetration rate.

    "This notion is not correct, and we have discovered that our UNIX machines have Y2K problems," said Lalit Sawhney, chief of information systems at Hindustan Lever Ltd. (HLL). He also serves as chairman of the core group -- set up by the Confederation of Indian Industries (CII) -- to assess the status of Y2K compliance in India.

    HLL is one of the first companies that claims it is Y2K compliant. It spent nearly Rs. 600 million (approximately US$14.5 million) since 1996 on its project. The company had to bring its many facilities in line to become Y2K compliant. Those facilities include 67 factories, four sales branches, 121 depots, 10 profit centers, 114 accounting units and 106 departments, the company said.

    "Although computer penetration in the country is low, the Y2K problem is not just restricted to computers alone. It also includes embedded systems that are incorporated in all kinds of factory equipment and machines," said Raghavendra Rao, a product manager at Satyam Computer Services Ltd., a major software vendor.

    A recent study covering companies with sales of at least Rs. 4 billion (US$96 million) and using IT equipment for 15 years revealed that 70 percent of them have Y2K problems. Those companies are taking steps to implement safeguards.

    However, midsize companies do not seem to have realized the importance of the problem. They generally lack the resources to replace or correct their existing Y2K non-compliant computer systems, the study said.

    According to estimates, India needs to spend Rs. 14 billion (US$335 million) to solve the millennium bug problems.

    The Prime Minister's Task Force on Information Technology recommended that the government set aside a fund of Rs. 7 billion (US$167.5 million) to enable government organizations to initiate steps to become Y2K compliant.

    The Reserve Bank of India (RBI) has informed commercial banks and non-banking finance companies to become Y2K compliant by March 1999 or face penal action. The RBI has set up a committee, under the chairmanship of Deputy Governor S.P. Talwar, to monitor the progress of Y2K compliance within RBI as well as other financial sectors.

    According to a study conducted by the RBI, 56.74 percent of commercial banks were expected to have become Y2K compliant by Dec. 31, 1998, and the entire banking sector is expected to be Y2K compliant by June 30, 1999.

    Major stock exchanges, including the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), also have initiated measures to become Y2K compliant.

    "Our software was developed in 1995, and it is Y2K compliant. Also, we use Tandem's Guardian D45 operating system, which is totally Y2K compliant," said V.K. Joglekar, deputy general manager of the BSE's Information Systems unit.

    Still, there are some gaps that the stock exchanges must address. For example, the BSE has nearly 540 active brokers and the NSE has about 900 brokers with around 2,000 broker offices, and they need to be Y2K compliant. The NSE claims to have achieved about 60 percent of its objectives for Y2K compliance.

    Among major companies, Life Insurance Corp. of India (LIC), which enjoys a monopoly in the domestic insurance business, has initiated strong steps to tackle the Year 2000 problem.

    (S. Swarn, Asia BizTech Correspondent)

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    Updated: Thu Jan 7 17:39:06 1999 PDT