US Turmoil reaches Indian outsourcing industry
Posted on September 25th, 2008 in Business Tech |
Hold on, its going to be a tough, long, painful ride. In the aftermath of Lehman, Merill, and the gang on Wall street , hundreds of millions of dollars in outsourcing contracts are in limbo. TCS, and Satyam are hurting, the Infosys will feel some pinch if not now, then soon enough. All together, the expectation is that over a billion dollars of revenue will be wiped out this year. AIG is next to cut down its IT outsourcing contracts.
Ofcourse, this is of little concern to the US government, but the Indian “Big three” will have to absorb this hit. This ofcourse leaves the door open for the smaller, cheaper, faster firms to step in and grab what they can… this has ofcourse, also hit the Pakistani companies (TRG might get hit some? ) but the effect has not been nearly as bad or as deep. This is because the numbers are smaller, the exposure is more limited and if anything, this opens more doors for the Pakistani tech industry than it closes.
Full story below:
http://www.financialexpress.com/news/Lehman-effect-Outsourcing-deals-in-limbo/362216/1
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4 Responses
Yes all the offshoring partners of the impacted firms will be impacted but wondering how the pakistani’s firm will be able to get advantage. The Big Three have the expertise and now even the resources at their disposal (they don’t need to recruit thousands of engineers every month due to recession), and I don’t think the US companies would risk whatever IT projects they have by sending them to start ups.
There are already lots of contracts already signed by smaller US companies with Pakistani offshore shops. These are the companies that the big three did not have time to focus on (why focus on a 500k USD deal when you have a billion dollar lehman deal to worry about?). These US firms in the current environment have a huge advantage for growth, and they will grow, and along it with, the contracts (already signed) will grow too. this is a prediction, could be different ofcourse.
I hope this does’nt have to much impact, as I just started with TRG in the United States. Never thought that AIG would be investing in TRG
TRG is quite a safe bet to work with. They have the depth and experience and I think they will do very well.