Channelling Cambodia in Phnom Penh

The plant still exists and could be started up again if things change. Thakral has leased it to some investors in the short term, Rajvanshi says.

Thakral moved from "simple hardware, sales and service" in 1994 after realising that Cambodian computing was mainly desktop-based. The company started networking and integration, initially at
a LAN level.

It worked with partners like Compaq – and later, HP – IBM and Microsoft, and more recently, Toshiba and Sun.

"And since our group has significant presence in India as well as in the region, we are working towards some low-cost solutions for ERP, something in Cambodia that we haven’t come across," Rajvanshi says.

Wireless networking is really picking up now in Cambodia. "Cambodia tries to keep pace with all the latest things, although it’s very difficult because the infrastructure is not there," he adds.

Other obstacles exist, such as getting the right people to do a job the right way. Human capital is critical for business, and so is a helpful political climate.

Prime minister Hun Sen has put some business-friendly policies in place but much more needs to be done, Rajvanshi points out.

"It’s easy to say, difficult to do," he says.

"But it’s not a level playing field for business. Certain people have great advantages. And the government should try to make things more transparent."

Hun Sen – who lost his left eye serving in the Khmer Rouge, from which he later defected – has been criticised, but it is generally agreed he has steered Cambodia firmly through the transition years following his first accession to the prime ministership in 1984.

Rajvanshi says many laws are being enforced "most strictly" now. All in all, things are steadily improving.

Hun Sen has promised to strengthen the legal framework, in exchange for US$504 million pledged globally for Cambodian development in 2005.

The IT supply chain is also coming along. Thakral works with the Japanese and achieves just-in-time, back-to-back ordering, he says.

However, the banks could be better. "If you borrow something from banks and pay about 18 percent interest, it’s not easy to make money because the volumes are not there," he says.

Taken together, a less-than-ideal business environment in an industry where high volume sales are limited and overall margins are tight makes for a certain degree of difficulty, Rajvanshi says with a smile.

Just two percent of Cambodia’s 13 million people actually contributes to GDP.  Outside Phnom Penh, even basic infrastructure – roads, sanitation, electricity – is largely non-existent, he points out.

"Yet ICT is really growing quite OK. In communications, there’s been a lot of interest by mobile operators here and a lot of scope for networking," Rajvanshi says. "We will stick to our own plan. We will not venture where we don’t have
the expertise."

As for foreign investment, few big names have dared enter Cambodia as yet. "We’ll have to wait and see," Rajvanshi says.