Indian IT sector is safe or not ?

[Gauresh]

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IT sector faces many problems due to Economy crises. Then fraud by Satyam (largest outsource vendor in India). India's fraud-hit Satyam Computer said Friday it was cooperating with investigations, as its former chairman was slated to seek bail on accusations of financial wrongdoing. Satyam executives "are available to authorities and Satyam is cooperating fully with all ongoing investigations," the Hyderabad-based company said on its website. because of Economy crises many IT firms adopt lay off policy. because of that many employees and fresher students who selected through campus lose there job.

There is big question on Indian IT sector One of the fastest growing sectors in India, IT-ITeS has been growing at a CAGR of 30 per cent. With such huge potential, IT-ITES is one of the key thrust areas of Government of India.

Indian IT sector is safe or not ?

[pancham]

I think Indian IT sector will suffer for Next 6 months, and this may extend until n unless India has strong position in IT Field, because Indian IT market depends on the Foreign IT field. The large IT projects are from the MNC companies, and because of this any fall in the Foreign market has the Straingt effect on the Indian IT field.

Like to hear more from You.

[Yuvraj]

Indian IT sector is strong it will recover soon. Information Technology will never fall, it will always increase. IT sector is not only one sector which is facing loss due to the economy crises banking sector also face loss.

[pushpendra]

I think Indian IT sector will suffer for Next 6 months

Not only Indian it sector but all other sectors like Reality, Banking, Power etc. will also suffer or you can say suffering. because we are heavily depend on foreign markets. From stock markets view FII (Foreign Institutional Investor ) is selling billions of dollars equity in indian market to provide working capital and returns in their own country.

I agree that IT industry earns primarily in USD and spends in INR, but have you realized what are the margins in the industry? Do you actually think that an industry which works on a profit margin of 30%+ would worry about a percentage point or two drop in the exchange rate?

Lets even assume that the dollar devalues so much that the margins in the IT industry are in trouble. But the beauty is that the single largest cost component in the industry is salaries. With the attrition being as high as 30% and the company recruiting at the rate of 25,000 employees a year, it should not be hard to cut costs and restore the margins back to the original levels. Also almost half to 1/3 of the salary is through performance linked pay, variable pay, or bonus, hence the HR has a lot of freedom to cull costs.

If you have realized, one of the biggest problems that Outsourcing industry was facing was resistance from US nationals. This is the major reason why the outsourcing industry could not expand at the rate at which they want to. However when the US company itself is in danger of going under, they will see Indians not as a threat, but as a saviors which would help them cut costs and reduce the losses.

[SushmitaP]

Well that's a nice discussion & would like to here more responses from IT people.
Right now am doing MCA & I would like to know what IT industry professionals say about all this problems & specially for students like us?