'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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