Global Recession Affects Indian Outsourcing

From The Economic Times of India: Indian outsourcing companies are likely to witness a slump in hiring activity owing to the current global economic scenario, but the decline would not be as “substantial” as was after the 2008 financial crisis, experts believe.

Map of India's major territories.

Map of India's major territories.

There is definitely an impact of the global economic scenario on Indian IT and outsourcing firms, however, most of them have long-term contracts with their clients which were signed at extremely competitive rates, experts said.

According to HR consultancy Hay Group’s managing consultant (Mumbai Operations and Rewards Practice Leader) Sridhar Ganesan, “post 2008, business planning with high focus on risks and mitigation has been critical for Indian IT firms.”

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Indian BPO companies in their evolution of business from basic services to more complex services have also realised that clients are looking at portfolios of operations.

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India, which was earlier preferred for its low cost advantage has lost that tag, as in the last decade salaries have gone up, infrastructure cost has increased and support system cost has also jumped.

Companies are now looking for newer avenues where they can align their costs are hence preferring countries like the Phillipines, China and Africa.

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