The Hindu Business Line : No stopping of job shifts, say analysts

DESPITE some blips tracking the US Presidential elections and growing patriotic fervour seeking to restrain job migration, order flows to Indian software vendors would continue at a robust pace going forward, analysts said.

"As the Presidential campaign reaches its peak and a new Government takes over, sales cycles could stretch a bit which in turn could cramp volumes... but that would be a blip on the broader offshoring screen," a technology analyst with a foreign brokerage said.

"Though the US Government is now talking of incentives even to private companies" to go slow on outsourcing, the economic sense outweighs the patriotic fervour, Mr Dhiraj Sachdeva, analyst with ASK Raymond James, said.

The National Association of Software & Services Companies (Nasscom) had said that the recently tabled US Senate Bill seeking to curb outsourcing of federal contract might impact less than two per cent of India's software exports. This was mainly because the share of US federal government contracts in India's IT software and services exports was much less as compared to private corporate bodies.

"Business compulsions for global competitiveness will rule and the volumes will not shrink substantially," said Mr Ravindra Datar, Principal Analyst-Software Services, Gartner India. However, some new and potential clients may delay signing contracts in a wait-and-watch mode, but for projects that are well under way, it will be difficult to make sudden shifts in the offshore-onsite mix, especially given the tight H1-B situation, he added.

However, both the vendors and the clients are likely to be "over-secretive" on work flows during June-November period, analysts said.

"Already, you can see that the companies are reticent about client wins... it will increasingly become difficult to get information on new accounts going forward," the analyst with the foreign brokerage noted.