'No job cuts in India's IT industry'

'No job cuts in India's IT industry'

Thursday, 30 October 2008, 05:26 Hrs   |    17 Comments
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Tokyo: There will be no pink slips in the Indian information technology industry as it has countered the impact of the current global financial tsunami well, according to Nandan Nilekani, co-chairman of Infosys Technologies.

"The fundamentals in the information technology sector are strong. I do not see any job cuts," Nilekani, who is a member of a business delegation accompanying Prime Minister Manmohan Singh here, said on the margins of a meeting here.

"At Infosys, we have lowered our growth and graduated from 13-15 percent. There are also other factors like cross-currency," said the co-founder of India's second-largest software exporter.

Industry experts have said that losses on account of a depreciation of one currency had been made up by appreciation in another due to market diversification, where Indian IT industry's heavy reliance on the US market was slowly coming down.

Nilekani said the global financial crisis was complicated and maintained that the Indian government had done a great job in handling the situation, even as Manmohan Singh said India had the resilience to sustain a high growth momentum despite the crisis.

The 20-member Indian business delegation led by Reliance Industries chairman Mukesh Ambani also met with corporate honchos of the Japan Chamber of Commerce and Industry during the business luncheon.

Others in the business delegation included K.V. Kamath, chief executive of ICICI Bank and president of the Confederation of Indian Industry (CII), and Malvinder Mohan Singh who a day earlier sold his family's entire stake in Ranbaxy Laboratoiries, Indias's largest drugs maker to Daiichi Sankyo of Japan.

Even Kamath pointed out that the fundamentals of the fast-growing Indian economy have been and continue to be strong and that there was enough liquidity in the system, accompanied by high corporate confidence.

"The situation in India is different," said Kamath whose heads India's largest commercial bank in the private sector. The challenges before our banks are not like the ones being faced by the West," he said.

"Indian banks are lending to corporates and are not cutting back on commerce."

During his presentation before corporate captains from India and Japan, Manmohan Singh said the Indian banking system was well capitalized and that additional liquidity had been quickly pumped in after industry complained about a credit crunch.

"The short-term outlook is somewhat cloudy but I am confident that the Indian economy has the resilience to sustain its growth momentum in the medium run."
Source: IANS
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Reader's comments(17)
1: Isn't like playing with the employees carrier.Saying a work doesn't sense anything,but keeping up a word is what really costs.
Posted by:Chaitanya - 18 Nov, 2008
2: Isn't like playing with the employees carrier.Saying a work doesn't sense anything,but keeping up a word is what really costs.
Posted by:Chaitanya - 18 Nov, 2008
3: Isn't like playing with the employees carrier.Saying a work doesn't sense anything,but keeping up a word is what really costs.
Posted by:Chaitanya - 18 Nov, 2008
4: Isn't like playing with the employees carrier.Saying a work doesn't sense anything,but keeping up a word is what really costs.
Posted by:Chaitanya - 18 Nov, 2008
5: Is Infosys in India or Moon?
Posted by:arun - 31 Oct, 2008
6: Reasons for these comments from Nandan are

1. To protect his share value

2. Say we are mature and stop bonuses/hikes to employees

3. Attract new/fresh talent (cheaper) by indirectly talking about job security at infy

4. Hidden trimming of the orgn has began.

The facts i feel are simple

the days of Hype and free jobs for freshers are over.

This brings us back to 90's where there was stiff competition to get into big companies like infy wipro and mnc's

so it's time for survival of the fittest.
Posted by:RRR - 30 Oct, 2008
7: is this topic is true or the comments are :)
Posted by:Gajendra - 30 Oct, 2008
8: The ultra optimistic comments of the co Chairman of Infosys are rooted more in hope than in reality. A brute proportion of Indian IT majors are closely aligned to the US centric BFSI segment which has been almost annihilated in the last three months. Captives of mega banks like Goldman Sachs & Morgan Stanley have virtually frozen incremental hiring in India. How does Infosys hope to hire progressively for such clients in the immediate future? The way off-shoring pans out is somewhat like this. The highest end architectural work tends to stay at the corporate CIO's office, some designing work is farmed out to of-shored captives in countries like India whereas the "mass" grunt work goes to third party service providers like Infosys, Wipro, TCS etc.
The number of jobs that a US bank typically creates within a third party provider is about five to ten times that of its captive. Flowing from this format, the maximum cut backs would be experienced by the third parties. If Nelkani was so sure about the hiring commitments of Infosys, why did his company have to lower its revenue guidance?
Posted by:Chiranjit Banerjee - 26 Oct, 2008
9: This statement given by this Infy Co-Chairman is just to ensure that the brand "Infy" should remain respectable among the student community, so that they can get new efficient resources easily.
Rest as far as indian IT industry is concerned, it is just on the threshold right now, these guys are just looking or more specifically, hoping that condition will improve,
Few years before, the scenario was such that the cost difference in getting work done onshore to outsourcing it offshore costed 6 times less, so the ratio was 1:6. as years gone, indian IT developed salaries increased, it became 1:3 around 2003-04. Now after adding the inflation, and adding the new additional taxes and duties on Outsourced work (which obama will do if he comes to power looks quite sure) then this difference will furthur get narrow down, so think time is not looking that much good, but who knows what will happen next.
Let's hope for the best
Posted by:pankaj - 22 Oct, 2008
10: never trust this infosys people. they cut the jobs of trainees simply by stating not cleared. Many of my friends were faced this situation and nw they dont have other offer.
Its time for the young people to think before u join infosys.
Posted by:febi - 22 Oct, 2008
11: For the past 1 year, Infosys has sent more than 25% of it trainees stating reason as not cleared training.(I have information from people from many training batches). This has never happened in Infosys before. Is this not Job cut. If its not job cut, then its surely a ineficiency in their recruitment policy.

Infosys does not bother about how bad their career get affected. There were lot of people who had multiple offer who had opted for Infosys and by the way getting thier other offers cancelled. Now they are in a position where they dont have Infy job as weel as other offers.

Some News Agencies, should come up to investigate on this and expose it to thousands of student community who get fooled. There was an incident of a girl commiting suicide infosys mysore campus on the day she was asked to leave for not clearing the training. This issue is worth Investigating...
Posted by:Maddy - 22 Oct, 2008
12: Time has come for Indian IT companies to Tap the opportunities in europe, Asia and within india. also the devlopment for other smaller indian cities for cost reduction for IT companies.
Posted by:Ajith Nair - 22 Oct, 2008
13: Hey, i'm an example for job cut. Yesterday our company has layed us all. Our company is not equal to Infosys, but at the same time, because of no future project due to financial crisis, they have layed us all. This is what the email from HR said... And this title says "No job cuts in India's IT industry: Infosys Co-Chairman". People should know what they speak... On Nov or Dec, i'm getting married and i'm chucked out of the job...
Posted by:Imran - 22 Oct, 2008
14: It's true to an extent... can't be positioned for all all IT companies.
Hence, as the reviews say... "Stick to the biggies"...
Posted by:ashutosh - 22 Oct, 2008
15: Wonder how it can be generalized? is Indian IT industry Infosys?

A lot of mid sized companies are struggling to manage their costs as new contract acquisitions have come down dramatically.
Posted by:critic - 22 Oct, 2008
16: are they sure...
Posted by:manthan - 22 Oct, 2008
17: maa ke laude
Posted by:katlu - 17 May, 2010