http://economictimes.indiatimes.com/Opinion/The_Lehman_effect/articleshow/3491141.cms
India's outsourcing story has become the unintended victim of the collapse of some of the most venerable Wall Street firms such as Lehman Brothers and Merrill Lynch since the subprime crisis began to unravel. India can no longer claim that BPO/KPO operations will escape unscathed from troubles of the US financial sector. Already, hundreds of jobs have been lost following the downsizing of operations and closing down of back offices in India — the toll of the collapse of Lehman is reportedly about 2,200 jobs. Several other global financial services companies too have been forced to cut the strength of the back office operations in India, laying off people across various functions as their incomes were hurt by the crash of the stock markets<http://economictimes.indiatimes.com/Opinion/The_Lehman_effect/articleshow/3491141.cms#>. Software majors such as TCS, Infosys, Wipro and Satyam that earn a significant portion of their revenues from the banking, financial services and insurance (BFSI) sector would need to be prepared for loss of business. Needless to say, the loss of several well-paying jobs would dampen demand in some product-segments as well as the real estate, which is already suffering due to sluggish sales. Indian companies which have partnered these institutions for business collaborations or funds would have to be prepared for a change in partners and even stake sale by the distressed institutions. However, that is not to say the collapse of the financial sector would make the outlook for India and its market more gloomy. There have been a few positive developments over the past couple of weeks. For instance, the industrial production for July 2008 looks healthier, rising 7.1% over the same month last year. In particular, the robust growth of the capital goods sector (albeit over a low base in July 2007) and consumer durables (perhaps in anticipation of the festival season demand) are definitely encouraging. The decline in global commodity prices, particularly crude oil now inching close $90 a barrel, should spell good news for inflation control. Besides, the first quarter GDP growth at 7.9%, although slowest in three years, reflects that the fundamentals of the economy is still very strong. That should inspire confidence in the performance of our stock markets. --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Green Youth Movement" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [EMAIL PROTECTED] For more options, visit this group at http://groups.google.com/group/greenyouth?hl=en-GB -~----------~----~----~----~------~----~------~--~---
