IT companies that have pitched their tents in the Middle East are cashing in on the opportunities in the oil-rich region as spending on technology is spurred by the wealth from soaring crude oil prices.

The cash-flush region is being seen as an alternative viable market as the US slows down and Indian companies find themselves making good headway with their price advantage. A favourable time zone, a multi-lingual workforce and efforts by governments to diversify and liberalise are attracting companies into this untapped market.

Among those capitalising on the Middle East opportunity is Wipro Infotech, which expects triple-digit growth from the region this year. "This will be our major revenue driver over the next 12-36 months," says chief executive Anand Sankaran. "We have had operations in the Middle East for seven years with offices in Saudi and Dubai. The market is bullish as IT requirements here are increasing."In one of its largest deals, the company has entered into a five-year contract, worth over $100 million, with Saudi Airlines, he said. Wipro has a multi-million dollar contract with Saudi Telecom after it was opened up to private players.

Some of the major areas driving up IT investments are the telecom and the realty sectors. "Various sectors have opened up of late. Many sectors, especially oil and gas companies, require a lot of infrastructure services, data centre management facilities and maintenance of applications. The realty scene is promising as the Saudi king is looking at creating five digital cities where a lot of IT infrastructure is required," Mr Anand says.

Small players like Vitage Technologie, are also benefiting. "We have about $3 million worth of contracts from the Gulf. There are a lot of tax advantages and plenty of opportunities from the banking and financial services and realty verticals. We have even opened a sales and marketing unit there," says the firm's CEO
P Rangarajan.

"There are huge IT investments being made by the Saudi and UAE governments."

UAE government sources say the market for IT in the federation was worth $2 billion in 2007 and is expected to reach $2.5 billion in 2010. "The Middle East governments are good IT users. Companies like Oracle, Satyam and Wipro Infotech are making a headway there," says Sudha Kumar, CEO of Prayag Consulting.

Networking major Cisco has announced a plan to invest $1.6 billion in the UAE over the next five years. This investment is expected to create up to 650 jobs by 2010, the company has said. Headquartered in Dubai, Cisco Gulf and Pakistan has over 350 employees. It had started its operations in the Middle East in 1993, opening its first office in Dubai in 1994. A new regional headquarters is planned for Dubai soon, company officials say.