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US slowdown won't impact Indian IT

 

Global research advisory, Gartner Inc, on Monday threw up a surprising

forecast for the Indian information technology (IT) industry when it

announced that the US economic slowdown would not impact the overall Indian

infotech industry over the next 12 months.

Painting a rosy outlook for the sector, Gartner said that it would continue

to register healthy growth of 50 per cent per annum.

The prediction of Gartner comes at a time when more and more Indian software

companies announce lower revenues and issue profit warnings, citing US

economic slowdown.

However, Gartner said that the US slowdown in fact offers a tremendous

opportunity for Indian software firms to build new capabilities, tap new

markets and to attract more outsourcing work.

``India is in an extraordinary position and the IT industry would continue

to have a growth of 50 per cent per annum,'' said Mr Bob Hayward, Senior

Vice-President, Operations, Gartner Asia Pacific, at a press conference to

announce Gartner Summit 2001, which gets under way here on Tuesday.

Mr Hayward said that some Indian companies will surely suffer, but the

smarter ones would continue to grow by building their brand equity, focusing

on research and development and by developing intellectual property rights

(IPRs).

``People should realise that the US slowdown is sectoral. And anyway it is

going to end by November-December this year as no slowdown persists beyond

12-14 months,'' Mr Hayward said, urging Indian firms to prepare themselves

for the oncoming boom time.

``The growth opportunity for India is that even if the technology sector in

the US is depressed, the other large sectors of the US remain largely

unaffected.

``Traditional businesses are increasingly looking at outsourcing their

business offices into India - eg. call centres, back office, financial

transactions and research and development.''

The e-services market has the potential of reaching $150 billion by year

2008, and India is poised to take a large chunk of this, Mr Hayward added.

 

Source : Business Line

Aug 7, 2001