Infosys has lost money on all govt projects: Murthy

Infosys, country's second largest software services firm, has not made any profit on government projects because of red-tapism and other issues, its co-founder N R Narayana Murthy said on Monday.

Highlighting issues like delayed payments and changes in project requirements mid-stream, the former Infosys chairman said government projects need to have clauses at par with international practices to ensure participation from Indian players and to make campaigns like Digital India successful.

"There is not a single project Infosys has done and not lost money, that’s a reality, when dealing with the governments," Murthy told CNBC-TV18.

He added that low price, delayed payments, not accepting software on time, changing requirements mid-stream, not allocating enough time to define requirements and in some cases, corruption are some of the issues that IT firms faced while working on government projects.

"If those things are all adhered to, I have no doubt at all that the entire IT industry will rally behind the government in making Digital India a success," he said.

In the past too, Infosys has expressed concerns about working on government projects.

In India, the Bangalore-based firm works with government in areas like financial inclusiveness and access, healthcare, utilities, e-governance, and agricultural and livestock productivity.

It works with various government agencies including Finance Ministry and Department of Posts.

Stating that Indian companies derive 90-98 per cent of their revenues from global corporations, Murthy said the prices are "very attractive" outside India.

"Therefore, unless the government of India comes up with reasonably attractive and competitive set of clauses, I am not very sure if the large companies will be keen on working with the government," Murthy said.

Murthy said the government should have a contract that is considered fair to both the government and the companies.

"Let us make sure that we are reasonable in our expectations, that we show our commitment to completion of the project. Let us allocate enough time of our officers to define the problem properly... make sure there are no unfair penalties," he said.

Murthy added that Digital India will become a very important instrument for creating large number of jobs.

"Digital India were to succeed if it becomes easier to work with the government, and if government were to accept the international standards of contracts in software development, and in accepting the software the company has developed, if they pay on time etc," Murthy said.

He was confident that the ambitious Digital India project will offer opportunities for applications in local languages like Hindi, Kannada, Tamil and Bengali.