Mumbai: Irrespective of whether prospects for the $101 billion (around Rs 5 trillion today) Indian information technology (IT) and business process outsourcing (BPO) industry are better than what the current economic gloom would suggest, the mood in the sector was definitely the topic of discussion on the opening day of the Nasscom India Leadership Forum’s 20th edition in Mumbai on Tuesday.
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The forum comes after the industry lobby group, the National Association of Software and Services Companies (Nasscom), slashed its forecast for export revenue growth for the industry to 11-14% in the next fiscal from 16.3% in the year to 31 March.
Even IT minister Kapil Sibal alluded to the mood, saying that the conclave seemed fuller this year than the previous edition.
To be sure, the conclave has about 1,600 delegates, over 45 sessions with 120 speakers and participants from about 25 countries. What the numbers don’t reveal is the fact that the participation of overseas delegates has dropped from earlier years, as the US economy struggles to recover and Europe battles a sovereign debt crisis.
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“We have 25 countries that are here, we have countries that make sense that are here, so actually we haven’t seen any significant reduction in the interest levels here. Surely, there will be many companies who instead of sending 10 delegates would send six, but for us I think it’s the quality of participation,” Nasscom president Som Mittal said in the event’s defence.
This is perhaps also reflected in the fact that domestic revenue is estimated to grow by 16.8% in the current fiscal, beating the projection of 16.3% for exports.
Infosys Ltd’s executive co-chairman Kris Gopalakrishnan alluded to this when he said that the industry’s fundamentals remained unchanged and the mood was being caused by external factors both domestically as well as internationally.
“As an industry, we are critical of ourselves, but that is necessary because of the sheer potential that exists,” he said, saying that the industry had grown through both the 2001 collapse of the Internet bubble and the capitulation of global financial markets in 2008.
“We have learnt to grow despite tremendous duress. So, we’re confident we can grow despite external factors,” Gopalakrishnan said.
Nasscom on Monday projected that the IT and BPO industry will add 200,000 jobs in 2012-13, down from 230,000 jobs in 2011-12 and 240,000 in 2010-11.
“From our perspective, we see traction, but the uncertainty will probably hold them back and that’s why we’ve said that in two quarters from now, there will be more clarity that will emerge. This is a year for elections in various markets and as these events are completed, we think business will be back,” Mittal said.
Perhaps, the best take on the mood came from an industry outsider.
“Screw the mood, it doesn’t matter. Stay with the logic because businesses are run by logic,” said Rajiv Bajaj, managing director of Bajaj Auto Ltd, who shared the stage with another outsider, Axis Bank Ltd’s Shikha Sharma at a panel discussion themed “Is business better than the mood? Deciphering the New World (Dis)order.”
john.k@livemint.com