Technology Growth in India Modest, USA Economic Woes Slow Outsourcing Deals
India’s top software services companies are set to report modest rises in profits compared with the boom times of recent years as a sluggish US economy crimps outsourcing deals, and the sector’s growth is set to slow further.
Investors will focus on new orders, pricing and hiring plans as the export-driven industry battles a fall in profit growth on growing evidence of a recession in the United States. Helped by an army of English-speaking workers and cheaper wages, India’s estimated $64 billion software services sector has thrived by winning deals from overseas clients, with the US accounting for more than half of the sector’s revenue.
“US economic recession concerns are likely to lead to worsening business prospects for the Indian IT sector,” Harit Shah, analyst at Angel Broking, said in a report.
