European IT firms upbeat on Indian operations

By agencies   |   Wednesday, 30 March 2005, 08:00 Hrs
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BANGALORE:European information technology (IT) service firms are turning more and more to India in a bid to cut costs, raise profits and ward off an emerging threat from Indian rivals on their own turf.

Capgemini, Atos Origin, Xansa and LogicaCMG are among IT firms hiring thousands of staff in India as they look to improve margins by providing services at cheaper rates. The main driver for local service providers here in Europe is the need for them to be able to compete cost effectively and profitably.

Companies say customers are forcing the change by demanding services at cheaper rates. That's what has caused a huge scramble in the marketplace in the last 12 months. A surplus of skilled people in India ensures that firms can quickly add staff to respond to a big contract win.

British IT firm, Xansa, among the first IT companies in Europe to have an Indian presence since 1997, has some 3,000 employees in the country and plans to raise it to 5,000 in 18 months. For LogicaCMG, India is part of a strategy of delivering services from a mix of locations worldwide.

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