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Recession and Indian IT sector

With the warnings flagging the possibilities for US recession, the analysts got a food for thought. All set to sail the same boat. What will be the out turn of the rest of the economies? How will Indian IT industry and economy react to this slow down?

 

Some were saying that economies will suffer a lot and India will also face the harder implications. The contemplations were obvious as US alone accounts for about one-fourth of world GDP as cleared by the market reports. Also when Y2K bug was biting or on the time of last IT bubble burst in 2000 India suffered a lot. The Indian index fell by almost 15%. But same can not be mouthed fro this time. In so many years, India has scaled up astronomically. It has shown an enormous growth ratio.

 The past can repeat itself but when prospects are favoring growth, you can never say what happens next? The time has changed drastically since and then. The economic growth and the strong presence of India on the world map have made it to the non-vulnerable category of the countries. With India the other country sharing the space is China.But there are many implications of this US recession on Indian Economy, some good and bad. Below listed are some of the implications:·         The Indian IT and ITeS services can be hit harder as US is the largest market for these services. But the implication is supposed to get limited to smaller firms rather than hitting harder on larger firms.·         Contrary to what above said there are many opportunities waiting for India to bask on with this recession. It can look at the various possibilities available to it in niche areas and win the global mart.·         The US recession can set new shores for outsourcing services. No doubt Us is the largest client but the reluctance of US companies to offer services due to recession India can take up with this good chance.·         The appreciation of rupee against dollar is set to hit hard on Indian exporters. The dealings are done in dollar and the payment is done in rupees, so they will get bit lesser than their expectations.

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