India’s IT sector at the crossroads
Knowledge-based capital will determine India's future in the world economy
The better-than-expected third quarter earnings of Infosys Ltd may have come as a balm for India’s information technology (IT) sector which last fortnight reeled from the reverberations caused by employee firings at Tata Consultancy Services Ltd (TCS), but the worries remain. Many fear that the chickens may finally be coming home to roost for the sector, which through the years of high growth (the industry grew at a compound annual growth rate of 13.1% during FY08-13) and bumper profits, refused to move up the value chain. As the controversy at TCS shows, there are far too many people in the middle of the pyramid now, men and women who stopped coding long ago in quest of general management functions which yielded higher salaries but gave fewer opportunities for creative innovation.
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