But half way across the world, in the high-tech cities of India, the wave of euphoria is still at its peak. Will it sustain despite, or perhaps thanks to, the US slowdown, or are we at the beginning of an extended period of depression, that will last as long as the US slowdown?
We at siliconindia in the past few weeks went out to talk to the senior management of dozens of medium and large IT services companies in India. When we asked them the currently very fashionable question of how the slowdown is affecting their company, the answers were surprisingly unintelligent, and mostly exchanges ended up in our being asked back, “You are based in the US, and are in the thick of things. What is your perspective on the issue?” Our straight, but not so simple answers, dear friends, are embedded in this issue.

There is a sustained obsession among people both within and outside the IT services industry in India with 'moving up the value chain into software products.' Each time there are signs of any kind of slowdown in the growth of the industry and even otherwise, these people cry hoarse about India not producing branded software and claim that this will eventually bring about the Indian IT industry's downfall.

This has become the most fashionable statement to make about the industry, especially by the press, including Jason Pontin, editor of Red Herring. But nothing could be further from reality! He is harping on this when US-based, supposedly cutting edge product development companies with massive marketing muscle, like Cisco, Intel, Computer Associates, Oracle, and dozens of others are announcing slowdowns in their medium to long-term business outlooks. If this is the scenario among such companies - which are closest to the global marketplace and have the best talent, including a lot of it from India - there should be an even more drastic impact on India-based product companies, if there were any.