Since the beginning of the slowdown, IT firms have been maintaining that India will benefit if firms try to cut costs. Now, there is evidence that it actually may be happening.
In a conference call, Dell’s Asia-Pacific and Japan head Steve Felice said there is an opportunity to shift more work to Asia and Dell will do it. In its third-quarter results announced, the US-based PC manufacturer’s tight rein on costs helped it post better earnings despite a sales slump.
Dell has invested heavily in its India and China factories. From Bangalore, it has built systems management capability and software for enterprise activity. While in China, it does design work and R&D. In addition, in Malaysia’s Cyberjaya, it does software development. “Our intention is to grow these,” said Felice. Elsewhere, Dell has announced job cuts.
“We don’t just service Asia out of these locations. They have worked well globally to the extent that there are opportunities to shift more work to Asia arise, we will do it... We are happy with the performance of these facilities to serve global needs and will continue to invest them depending on market conditions,” Felice said.
However, he said the growth in Asia was not necessarily linked to the cost-cutting in the US and was in response to the growth in other parts of the world.
Felice said there was decline in overall IT spending in Asia-Pacific and Japan. Dell had weathered it and grown. Terming India’s growth as outstanding, he said the country had witnessed 77% growth in unit terms and 48% growth in revenues for Dell in the third quarter.
For China, growth was up 44% in unit terms and 18% in revenue terms. “We are extremely committed to India,” he added. The surge in growth has primarily come from consumers and the small.
Source: Times News Network
Saturday, November 29, 2008
Despite downturn VCs pour into India
The global economic downturn notwithstanding, venture capital investments have continued to flow into India and China, with both countries witnessing a significant surge in the third quarter this year.
According to a study by research firm Venture Intelligence, venture capital investment in India grew 36 per cent at 290 million dollars for the third quarter ended September 30.
Meanwhile in Mainland China, VC investments grew 22 per cent to 964 million dollars at the end of the third quarter, as per the data by Dow Jones VentureSource.
"It's clear that venture capital investors are still eager to put money into the emerging marketplace and, in many areas, they're actually accelerating the pace of their investments," Dow Jones VentureSource Global Research Director Jessica Canning said.
The increased investment by existing players and the entry of new funds contributed to the growth this quarter, the Venture Intelligence study stated.
"The pace of VC investments in India seems to be accelerating despite the turmoil in global financial markets," Venture Intelligence Founder and CEO Arun Natarajan said.
Meanwhile, as the number of VC deals nearly doubled in India to 49, China witnessed a saw the number dipping to 59 from 73 in the same period last fiscal.
"Larger deals drove investment in the third quarter as the median size of a venture deal in China remained at USD 10 million, which is the highest on record and the most out of any region we track, including the US," Canning said.
However, the venture capitalists shied away from investing in the Information Technology and IT-enabled Services (IT & ITeS) industry in China, the sector remained favourite among the VC firms invested in India.
Source: PTI
According to a study by research firm Venture Intelligence, venture capital investment in India grew 36 per cent at 290 million dollars for the third quarter ended September 30.
Meanwhile in Mainland China, VC investments grew 22 per cent to 964 million dollars at the end of the third quarter, as per the data by Dow Jones VentureSource.
"It's clear that venture capital investors are still eager to put money into the emerging marketplace and, in many areas, they're actually accelerating the pace of their investments," Dow Jones VentureSource Global Research Director Jessica Canning said.
The increased investment by existing players and the entry of new funds contributed to the growth this quarter, the Venture Intelligence study stated.
"The pace of VC investments in India seems to be accelerating despite the turmoil in global financial markets," Venture Intelligence Founder and CEO Arun Natarajan said.
Meanwhile, as the number of VC deals nearly doubled in India to 49, China witnessed a saw the number dipping to 59 from 73 in the same period last fiscal.
"Larger deals drove investment in the third quarter as the median size of a venture deal in China remained at USD 10 million, which is the highest on record and the most out of any region we track, including the US," Canning said.
However, the venture capitalists shied away from investing in the Information Technology and IT-enabled Services (IT & ITeS) industry in China, the sector remained favourite among the VC firms invested in India.
Source: PTI
Terror strikes; Is outsourcing safe?
Terror times; Is outsourcing safe?
large global firm runs its trading desk out of Mumbai. Bookings for a leading airline are happening out of another office in a neighbouring city, while the telecom infrastructure of an overseas operator is being remotely monitored from another location in the country.
A terror attack on any of these sites can have significant implications for corporations in the US and other parts of the developed world as India emerges as the world’s back-office.
For instance, if a trade is not squared off on time, the firm will have to carry higher liabilities. Wednesday’s attack raises questions about the vulnerability of these locations to terror threats and the preparedness of firms and authorities to tackle them.
The issue assumes importance as nearly seven out of every 10 outsourced processes come to India, according to industry estimates. While 6-7 years ago, business process outsourcing (BPO) mostly involved basic data entry, a number of mission critical processes such as airline bookings and investment research are now taking place out of offices in Mumbai, Pune and Bangalore.
In its strategic review, Nasscom, the apex industry body, notes, “Indian BPO has undergone significant transformation since its inception over a decade ago... The past few years have seen the scope of these services expand progressively to include more complex processes involving rule-based decision making and research requiring informed judgment and domain knowledge,” the apex industry body notes.
Indian firms also manage infrastructure worth over $3-4 billion remotely for clients. Damage to these locations can bring down desktops and servers, besides crippling entire sections of organisations outside India. “After 9/11, there is a greater appreciation of the risk arising from a terror attack,” admits KPMG executive director Akhilesh Tuteja.
“But the level of preparedness even for mission critical operations is below average,” he adds. The redundancy plan usually involves a backup and mutiple service providers to ensure connectivity. But process capability and an ability to swiftly execute the process at another centre are not a reality in most cases.
“Disaster recovery plans are like an insurance you may never use. There is now an awareness about the need to have them, but the decisions are usually postponed because this is not an investment that will result in growth. Firms usually make investments for growth,” says PriceWaterhouseCoopers managing consultant Nikhil Donde.
Companies are saving costs amid the slowdown, as every bit can eat into margins. Multinational parents are managing a majority of the mission critical operations by way of captives. Ideally, 70% of the process should be offshored and 30% retained at the onsite location to minimise the risks, according to Mr Tuteja. But again there is a trade-off on costs, with real benefits kicking in only when the process is completly offshored.
In client contracts with third-party firms, it is not uncommon to find clauses related to business process continuity (BCP). However, these clauses rarely go into specifics and are usually interpreted in terms of having a multi-locational presence, back-up capability and multiple connectivity providers. Rarely do they consider whether the alternate locations will have people with the necessary skills. And this is really the biggest threat in a terror attack, when people at one location can be killed, say the experts.
Source: Economic Times
large global firm runs its trading desk out of Mumbai. Bookings for a leading airline are happening out of another office in a neighbouring city, while the telecom infrastructure of an overseas operator is being remotely monitored from another location in the country.
A terror attack on any of these sites can have significant implications for corporations in the US and other parts of the developed world as India emerges as the world’s back-office.
For instance, if a trade is not squared off on time, the firm will have to carry higher liabilities. Wednesday’s attack raises questions about the vulnerability of these locations to terror threats and the preparedness of firms and authorities to tackle them.
The issue assumes importance as nearly seven out of every 10 outsourced processes come to India, according to industry estimates. While 6-7 years ago, business process outsourcing (BPO) mostly involved basic data entry, a number of mission critical processes such as airline bookings and investment research are now taking place out of offices in Mumbai, Pune and Bangalore.
In its strategic review, Nasscom, the apex industry body, notes, “Indian BPO has undergone significant transformation since its inception over a decade ago... The past few years have seen the scope of these services expand progressively to include more complex processes involving rule-based decision making and research requiring informed judgment and domain knowledge,” the apex industry body notes.
Indian firms also manage infrastructure worth over $3-4 billion remotely for clients. Damage to these locations can bring down desktops and servers, besides crippling entire sections of organisations outside India. “After 9/11, there is a greater appreciation of the risk arising from a terror attack,” admits KPMG executive director Akhilesh Tuteja.
“But the level of preparedness even for mission critical operations is below average,” he adds. The redundancy plan usually involves a backup and mutiple service providers to ensure connectivity. But process capability and an ability to swiftly execute the process at another centre are not a reality in most cases.
“Disaster recovery plans are like an insurance you may never use. There is now an awareness about the need to have them, but the decisions are usually postponed because this is not an investment that will result in growth. Firms usually make investments for growth,” says PriceWaterhouseCoopers managing consultant Nikhil Donde.
Companies are saving costs amid the slowdown, as every bit can eat into margins. Multinational parents are managing a majority of the mission critical operations by way of captives. Ideally, 70% of the process should be offshored and 30% retained at the onsite location to minimise the risks, according to Mr Tuteja. But again there is a trade-off on costs, with real benefits kicking in only when the process is completly offshored.
In client contracts with third-party firms, it is not uncommon to find clauses related to business process continuity (BCP). However, these clauses rarely go into specifics and are usually interpreted in terms of having a multi-locational presence, back-up capability and multiple connectivity providers. Rarely do they consider whether the alternate locations will have people with the necessary skills. And this is really the biggest threat in a terror attack, when people at one location can be killed, say the experts.
Source: Economic Times
Mumbai 26/11 ends after 60 long hours!
The war on terror in Mumbai was finally wrapped up 60 hours after a band of terrorists struck at various locations with three gunmen killed this morning at the landmark luxury Taj Hotel, bringing the operation to a close.
NSG commandos, who believed that a lone terrorist was holding out since yesterday, launched a final assault in the early hours of this morning and killed three terrorists to secure the old heritage area of the hotel opposite the Gateway of India.
"Three terrorists have been killed but the operations are still on. Until we search the entire hotel room by room and satisfy ourselves that there are no more terrorists I will not declare the operations are over.
"I don't know whether all of them have been killed. I can say only after completing the operations," Director General of NSG, J K Dutt, told reporters outside the hotel.
During the night, terrorists holed out in the hotel engaged in a fierce gun battle with security forces as some places in the first and the ground floors of the 565-room building set afire by terrorists amid explosions in the over 100-year-old heritage complex in the Colaba area.
Dutt said that the terrorists set on fire some rooms whenever they felt they were being cornered as a diversionary tactics.
An intense gun battle raged overnight at the Taj as commandos closed in on terrorists holed up in the heritage structure. Five huge explosions were also heard in the building in a span of 30 minutes.
The Marine commandos (Marcos) had surrounded the Taj where NSG personnel were carrying out the operation to flush out the terrorists. Multiple rounds of automatic gunfire and blasts from inside the building shattered several hours of relative calm.
The western metropolis witnessed unprecedented terror attacks, including on another luxury Trident-Oberoi hotel and a Jewish centre, on Wednesday night when heavily-armed terrorists struck killing over 160 people and injuring hundreds.
The might of the Indian security forces had to be brought in to rid these landmark in the country's financial capital of the heavily-armed suspected Pakistani terrorists, but the costs were heavy on both sides.
When the Oberoi was cleared of the terrorists yesterday, as many as 30 hostages were found dead.
Source: PTI
NSG commandos, who believed that a lone terrorist was holding out since yesterday, launched a final assault in the early hours of this morning and killed three terrorists to secure the old heritage area of the hotel opposite the Gateway of India.
"Three terrorists have been killed but the operations are still on. Until we search the entire hotel room by room and satisfy ourselves that there are no more terrorists I will not declare the operations are over.
"I don't know whether all of them have been killed. I can say only after completing the operations," Director General of NSG, J K Dutt, told reporters outside the hotel.
During the night, terrorists holed out in the hotel engaged in a fierce gun battle with security forces as some places in the first and the ground floors of the 565-room building set afire by terrorists amid explosions in the over 100-year-old heritage complex in the Colaba area.
Dutt said that the terrorists set on fire some rooms whenever they felt they were being cornered as a diversionary tactics.
An intense gun battle raged overnight at the Taj as commandos closed in on terrorists holed up in the heritage structure. Five huge explosions were also heard in the building in a span of 30 minutes.
The Marine commandos (Marcos) had surrounded the Taj where NSG personnel were carrying out the operation to flush out the terrorists. Multiple rounds of automatic gunfire and blasts from inside the building shattered several hours of relative calm.
The western metropolis witnessed unprecedented terror attacks, including on another luxury Trident-Oberoi hotel and a Jewish centre, on Wednesday night when heavily-armed terrorists struck killing over 160 people and injuring hundreds.
The might of the Indian security forces had to be brought in to rid these landmark in the country's financial capital of the heavily-armed suspected Pakistani terrorists, but the costs were heavy on both sides.
When the Oberoi was cleared of the terrorists yesterday, as many as 30 hostages were found dead.
Source: PTI
Mumbai Liberated: But will this be its wake-up call?
Just as the images of billowing smoke from the twin towers of New York are seared in the memories of people all television visuals of the raging fire in the ornate façade of Mumbai's iconic Taj Mahal Palace and Tower Hotel will be recalled whenever the deadly terrorist attack on India's financial capital Nov 26-29 is mentioned. The booming sound of gunfire as the security forces engaged the jehadis will also become a part of the nation's collective memory.
Although Mumbai is no stranger to such outrages - the Taj itself experienced a car bomb attack in 2003 - the latest tragedy stands out from the rest for the simple reason that it was an evidently commando-style raid by suicide bombers with the express purpose of inflicting as much damage as possible on some of the city's landmarks and targets of its prosperity and progress.
While in the earlier attacks, the terrorists planted bombs in market places or trains and then left the scene, this time they stayed on to battle the security forces and die or be captured in the process. Since they were all heavily armed and were able to take hostages, they could carry on the confrontation with the police for prolonged periods, which could not but have a hugely demoralising effect on the city and the country. Since India had not seen such war-like scenes before, the impact was devastating and it would take some time before its political fallout could be measured.
It is possible that the terror groups had realised the diminishing effect of their earlier tactics of planting bombs in crowded places and vehicles. In spite of the initial shock and revulsion in those instances, the effect tended to wear off, leaving only the victims to mourn their losses. But gunbattles lasting for hours and the wheeling out of bodies covered in white sheets from five-star hotels can have a numbing effect.
Source: IANS
Although Mumbai is no stranger to such outrages - the Taj itself experienced a car bomb attack in 2003 - the latest tragedy stands out from the rest for the simple reason that it was an evidently commando-style raid by suicide bombers with the express purpose of inflicting as much damage as possible on some of the city's landmarks and targets of its prosperity and progress.
While in the earlier attacks, the terrorists planted bombs in market places or trains and then left the scene, this time they stayed on to battle the security forces and die or be captured in the process. Since they were all heavily armed and were able to take hostages, they could carry on the confrontation with the police for prolonged periods, which could not but have a hugely demoralising effect on the city and the country. Since India had not seen such war-like scenes before, the impact was devastating and it would take some time before its political fallout could be measured.
It is possible that the terror groups had realised the diminishing effect of their earlier tactics of planting bombs in crowded places and vehicles. In spite of the initial shock and revulsion in those instances, the effect tended to wear off, leaving only the victims to mourn their losses. But gunbattles lasting for hours and the wheeling out of bodies covered in white sheets from five-star hotels can have a numbing effect.
Source: IANS
Friday, November 28, 2008
Social Networking sites surface from Mumbai ashes
Bloggers across Mumbai fed live updates of the unfolding action after terrorists launched waves of attacks in the heart of India's financial capital, bringing the emergence of citizen journalism in news coverage to the fore in India.
Social networking sites, such as Twitter and Facebook, were instantly updated with on-the-scene information by people. Minute-by-minute updates on social networking and micro-blogging sites not just satiated the writers’ hunger for expressing themselves, but also gave people more diverse news.
In fact, instead of switching on the television, many followed the action live on microblogging Twitter by searching the site for Bombay and Mumbai. In certain cases, Twitter updates reportedly appeared hours before the first TV stories.
The minute the news of the terrorist attacks broke out, sites like Twitter were inundated with a huge volume of messages. Twitter seemed to be the most popular choice among other social media sites. Just minutes after the first shots were fired; Tweeters (Twitter users) in Mumbai gave instant eyewitness accounts of the unfolding drama.
Messages, known as `tweets', were being posted to the site at a rate of around 80 tweets every five seconds when the news of the tragedy first broke, according to some estimates. Some bloggers provided running descriptions and commentaries from near the action, while others gave vent to their emotions.
"I've been tweeting almost all night from Mumbai. Upset and angry and bereft," said businesswoman Dina Mehta on her blog, http://www.dinamehta.com/blog.
Images of the attacks also surfaced on photo-sharing website Flickr. The site proved a useful source of haunting images chronicling the aftermath of the attacks.
Photographer Vinukumar Ranganathan has attracted hundreds of thousands of visits to his Flickr photo page where he has published a chilling slideshow depicting the aftermath of the attacks.
Twitter came in for some criticism as well in the blogosphere for divulging too many details that could prove helpful to the gunmen holed up in the hotels with their hostages and who may have been monitoring blog sites.
"It's a terrorist strike. Not entertainment. So tweeters, please be responsible with your tweets," said one blogger identified as primaveron@mumbai.
Unfortunately, the site also contained misleading threads, some of it purporting to be from intelligence services. In fact, many of the posts on Twitter amounted to unsubstantiated rumours and wild inaccuracies.
According to CNN, a rumour that the Indian government was asking Tweeters to stop live updates to avoid compromising its security efforts was published and republished on the site.
This was reportedly fueled by certain news websites, which posted the Tweet on their live update. It read: "Indian government asks for live Twitter updates from Mumbai to cease immediately. ALL LIVE UPDATES - PLEASE STOP TWEETING."
Several local Indian news channels were reported to have carried a live feed of the Twitter updates on the Mumbai attacks.
Twitter's contributors also questioned the veracity of certain TV news reports, pointing out contradictions and errors. When Indian reporters announced an end to Taj hotel siege time and again, Tweeters contended that gunfights were continuing. "Locals say gunfire still happening at Taj," said one feed, hours after fighting was said to have finished.
Many social network users also sent pleas for blood donors to make their way to specific hospitals in Mumbai where doctors were faced with blood shortage and rising casualties. Throughout the night, bloggers were active compiling news reports and contact information and information on blogging sites like mumbaihelp.blogspot.com.
Tweeters were also mobilised to help with transcribing a list of the dead and injured from hospitals, which were quickly posted online. mumbaihelp.blogspot.com also offered advice to those with friends and family in the city. "Suggest you avoid calling. Lines are bound to be jammed."
Other websites also quickly filled up with information: Wikipedia had a page up on the attacks by early Thursday morning. A Google map was created just hours after the explosions to mark the locations that had been hit.
Dozens of videos of the attacks have flooded the YouTube too. Gauravanomics has an exhaustive list of online coverage of the attacks. Slained Anti-Terrosism Squad (ATS) chief, Hemant Karkare, was reportedly the most searched topic on Google for nearly an hour after his death was declared.
Even Prime Minister Manmohan Singh’s address to the nation on Thursday was highly viewed, followed by angry comments.
Source: Indiatimes Infotech
Social networking sites, such as Twitter and Facebook, were instantly updated with on-the-scene information by people. Minute-by-minute updates on social networking and micro-blogging sites not just satiated the writers’ hunger for expressing themselves, but also gave people more diverse news.
In fact, instead of switching on the television, many followed the action live on microblogging Twitter by searching the site for Bombay and Mumbai. In certain cases, Twitter updates reportedly appeared hours before the first TV stories.
The minute the news of the terrorist attacks broke out, sites like Twitter were inundated with a huge volume of messages. Twitter seemed to be the most popular choice among other social media sites. Just minutes after the first shots were fired; Tweeters (Twitter users) in Mumbai gave instant eyewitness accounts of the unfolding drama.
Messages, known as `tweets', were being posted to the site at a rate of around 80 tweets every five seconds when the news of the tragedy first broke, according to some estimates. Some bloggers provided running descriptions and commentaries from near the action, while others gave vent to their emotions.
"I've been tweeting almost all night from Mumbai. Upset and angry and bereft," said businesswoman Dina Mehta on her blog, http://www.dinamehta.com/blog.
Images of the attacks also surfaced on photo-sharing website Flickr. The site proved a useful source of haunting images chronicling the aftermath of the attacks.
Photographer Vinukumar Ranganathan has attracted hundreds of thousands of visits to his Flickr photo page where he has published a chilling slideshow depicting the aftermath of the attacks.
Twitter came in for some criticism as well in the blogosphere for divulging too many details that could prove helpful to the gunmen holed up in the hotels with their hostages and who may have been monitoring blog sites.
"It's a terrorist strike. Not entertainment. So tweeters, please be responsible with your tweets," said one blogger identified as primaveron@mumbai.
Unfortunately, the site also contained misleading threads, some of it purporting to be from intelligence services. In fact, many of the posts on Twitter amounted to unsubstantiated rumours and wild inaccuracies.
According to CNN, a rumour that the Indian government was asking Tweeters to stop live updates to avoid compromising its security efforts was published and republished on the site.
This was reportedly fueled by certain news websites, which posted the Tweet on their live update. It read: "Indian government asks for live Twitter updates from Mumbai to cease immediately. ALL LIVE UPDATES - PLEASE STOP TWEETING."
Several local Indian news channels were reported to have carried a live feed of the Twitter updates on the Mumbai attacks.
Twitter's contributors also questioned the veracity of certain TV news reports, pointing out contradictions and errors. When Indian reporters announced an end to Taj hotel siege time and again, Tweeters contended that gunfights were continuing. "Locals say gunfire still happening at Taj," said one feed, hours after fighting was said to have finished.
Many social network users also sent pleas for blood donors to make their way to specific hospitals in Mumbai where doctors were faced with blood shortage and rising casualties. Throughout the night, bloggers were active compiling news reports and contact information and information on blogging sites like mumbaihelp.blogspot.com.
Tweeters were also mobilised to help with transcribing a list of the dead and injured from hospitals, which were quickly posted online. mumbaihelp.blogspot.com also offered advice to those with friends and family in the city. "Suggest you avoid calling. Lines are bound to be jammed."
Other websites also quickly filled up with information: Wikipedia had a page up on the attacks by early Thursday morning. A Google map was created just hours after the explosions to mark the locations that had been hit.
Dozens of videos of the attacks have flooded the YouTube too. Gauravanomics has an exhaustive list of online coverage of the attacks. Slained Anti-Terrosism Squad (ATS) chief, Hemant Karkare, was reportedly the most searched topic on Google for nearly an hour after his death was declared.
Even Prime Minister Manmohan Singh’s address to the nation on Thursday was highly viewed, followed by angry comments.
Source: Indiatimes Infotech
Mumbai 9/11 add woes to global IT industry
India's $52 billion outsourcing industry, battered by a global financial crisis that is squeezing its business clients, faces more Mumbai terror attack short-term challenges in the wake of attacks on Mumbai that killed more than 100 people.
Industry officials said prospective overseas clients were likely to put off planned visits to India because of the attacks, even though most software and back-office services firms were operating normally.
"This will surely introduce some sort of concern among clients," said Krishnakumar Natarajan, CEO of mid-sized software and R&D services provider MindTree Ltd.
"There was some expectation clients would start visiting India from January after the end of the annual holiday season. That will now get pushed away for some more time."
The software and back-office services sector, which earns billions of dollars from exports, is reeling from a global slowdown and turmoil in the financial sector, one of its major markets.
The chief financial officer at Wipro Ltd, India's No.3 software services exporter, told a Reuters India Investment Summit this week he expected a pickup in growth in the first quarter as companies firm up outsourcing plans, though many businesses will likely delay decisions and tighten costs.
India's large pool of English-speaking engineering workers and cheaper wages have helped attract outsourcing from western firms ranging from Citigroup and Goldman Sachs to Cisco Systems Inc and Nortel.
India's outsourcers compete against larger IT services firms such as IBM and Accenture.
"We have to wait for things to settle. This is a temporary aberration," said T V Mohandas Pai, a board member at Infosys Technologies, India's No.2 software services exporter.
"If countries issue advisories, it means some travel will be deferred. I think people will use technology or we'll go and visit our clients. Business will go on," he said.
"We have seen terrorist attacks happen in different parts of the world. It's unfortunate it has happened in Mumbai and I think business is confident the government and authorities will get to the bottom of it," he added. Bruce McIndoe, a travel security expert and president of iJET Intelligent Risk Systems, a private intelligence firm, said he had already advised his Mumbai terror attack corporate clients to postpone travel to Mumbai, and warned there would be "ripple effects".
Som Mittal, president of the National Association of Software and Service Companies, India's premier software industry lobby group, said companies were likely to be more cautious, but business would continue.
"We will not let the show stop as a result of the attacks," he said.
In July, eight small bombs hit the city of Bangalore, which is home to more than 1,500 Indian and multinational software and back-office firms. They increased security as a result.
"I think now more and more customers will be looking at what the Indian companies are doing to manage risk. They will ask what their disaster recovery and business continuity plans are," said Avinash Vashistha, chief executive of consultancy Tholons Inc.
"In the short-term, companies will see an impact as their clients stay away from travelling to India."
Industry officials said prospective overseas clients were likely to put off planned visits to India because of the attacks, even though most software and back-office services firms were operating normally.
"This will surely introduce some sort of concern among clients," said Krishnakumar Natarajan, CEO of mid-sized software and R&D services provider MindTree Ltd.
"There was some expectation clients would start visiting India from January after the end of the annual holiday season. That will now get pushed away for some more time."
The software and back-office services sector, which earns billions of dollars from exports, is reeling from a global slowdown and turmoil in the financial sector, one of its major markets.
The chief financial officer at Wipro Ltd, India's No.3 software services exporter, told a Reuters India Investment Summit this week he expected a pickup in growth in the first quarter as companies firm up outsourcing plans, though many businesses will likely delay decisions and tighten costs.
India's large pool of English-speaking engineering workers and cheaper wages have helped attract outsourcing from western firms ranging from Citigroup and Goldman Sachs to Cisco Systems Inc and Nortel.
India's outsourcers compete against larger IT services firms such as IBM and Accenture.
"We have to wait for things to settle. This is a temporary aberration," said T V Mohandas Pai, a board member at Infosys Technologies, India's No.2 software services exporter.
"If countries issue advisories, it means some travel will be deferred. I think people will use technology or we'll go and visit our clients. Business will go on," he said.
"We have seen terrorist attacks happen in different parts of the world. It's unfortunate it has happened in Mumbai and I think business is confident the government and authorities will get to the bottom of it," he added. Bruce McIndoe, a travel security expert and president of iJET Intelligent Risk Systems, a private intelligence firm, said he had already advised his Mumbai terror attack corporate clients to postpone travel to Mumbai, and warned there would be "ripple effects".
Som Mittal, president of the National Association of Software and Service Companies, India's premier software industry lobby group, said companies were likely to be more cautious, but business would continue.
"We will not let the show stop as a result of the attacks," he said.
In July, eight small bombs hit the city of Bangalore, which is home to more than 1,500 Indian and multinational software and back-office firms. They increased security as a result.
"I think now more and more customers will be looking at what the Indian companies are doing to manage risk. They will ask what their disaster recovery and business continuity plans are," said Avinash Vashistha, chief executive of consultancy Tholons Inc.
"In the short-term, companies will see an impact as their clients stay away from travelling to India."
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