Nasscom may cut growth forecast for 2009

Nasscom may cut growth forecast for 2009

New Delhi: Indian software and services growth could be slower than expected in 2008-09 as a global financial crisis crimps demand for such services, the country’s software lobby group, National Association of Software and Service Companies (Nasscom) said. Nasscom may revise its growth projections in December, a top official said on Monday.

The association in July had forecast revenue growth between 21% and 24% to about $50 billion (Rs2.3 trillion) in the year to March 2009.

“There will be short- to medium-term impact, which we define as three-four quarters. I won’t be surprised if the numbers are tempered down," Nasscom president Som Mittal told reporters. The US financial system was shaken after the collapse of investment bank Lehman Brothers Holdings Inc. and the rescue of insurer American International Group Inc., rattling Indian outsourcing firms which earn roughly half their revenue from the US.

However, the financial turmoil has led India’s information technology firms to explore new territories in Europe, Asia and West Asia to lower their dependence on the US, Mittal said.

The US government’s $700 billion bailout fund to buy bad debt is likely to lead to recovery of the markets, he added.