The anti-outsourcing move will not have any immediate impact on its revenues even as the Indian Information Technologies industry finds the recent speech by US President Barack Obama disturbing industry. They maintain that it may affect the business of small companies. The recent anti-outsourcing is not going to impact the Indian companies as most of their business are with the private companies. By the rhetoric, the private companies are still looking at the India as their outsourcing partner and are not affected. The similar sentiments were expressed by the global networking giant Cisco. The business is not driven by rhetoric but the hardcore commonsense. The US companies outsource because it is profitable and not just out of some political compulsion. The large contracts will not be impacted. There may be a certain disruption for small contracts and companies.
The US increased the fees for the H-1B and L1 visas, sought by the Indian professionals and Information Technolgies companies. The hike in the fees is expected to put an additional burden of $250 million annually on the Indian IT firms. There have been some of the concerns among the Indian Information Technology companies. There is a challenge that the companies are willing to commit for the short term but not the long term or the medium term. It becomes a challenging to do medium to a long term planning. The Cisco official pointed out that the companies are being held back from the committing to the long term contract not by the political sentiments but by the economic concerns. The global economy has not recovered completely and it is the companies that are trading with the caution before making the longterm commitments. The concerns are similar in the Europeans as well as the other markets.
The Indian Information Technology industry gets over the 60 percent of the revenue from the US. The Europe accounts for about 20 percent of the revenue while the rest is 20 percent comes from the Latin America, Middle East and other destinations. With the anti-outsourcing rhetoric getting louder In Indian Information Technology companies have started looking for the alternatives in the other markets like Europe, Middle East and Latin America. At the option, it is not the company. They have already started looking at the options in the Europe. The response is low but good. Once the economy improves they will get many more deals and also from the Latin America.
REFERENCE:
http://businesstoday.intoday.in/story/small-it-cos-to-feel-heat-of-ban-on-outsourcing/1/9011.html
