Business Daily from THE HINDU group of publications
Thursday, Jul 12, 2007
ePaper
Business Daily from THE HINDU group of publications Thursday, Jul 12, 2007 ePaper |
|
|
|
|
|
|
|
|
|
|
Home Page
-
Outsourcing Info-Tech - Interview
Mr T.V. Mohandas Pai
Vishwanath Kulkarni Infosys has revised its hiring projections upwards to 26,000 from the earlier 24,500 for fiscal 2008. Business Line caught up with Mr T. V. Mohandas Pai, member of the board and Head, Human Resources, at Infosys to know more. What prompted you to revise your hiring projections? The revised projection is basically to cater to the increased business requirements, which we anticipate. Your ramp-up in China seemed to be behind schedule and not on expected lines. What went wrong? We have not done as well in China as we thought we could. It is just that we underestimated the difficulties in growth, in a sense that global clients are slow to work out of China. A large part of the growth was based on the premise that our global clients would move work to China. It has gone slower than we thought. Now, we have 700 people there and we plan to crank up the hiring engine. I don’t want to put any number to our hiring plans. How is the rupee appreciation affecting the BPO sector? The operating margins in the BPO industry are around 12 per cent. The rupee rise had a nine per cent impact on our BPO margins. Further, the expenses for BPOs are all in rupee terms. If the rupee appreciation continues, we have to go out and look for people in low-cost areas. Indian companies are already going outside to create more employment. I think this will affect employment creation in BPOs in a big way. Our young people coming out from colleges in the next two or three years are going to lose out in large numbers. What needs to be done? The big challenge for India in the dollar depreciation is the opening of the external commercial borrowing (ECB) window. The national debt for India has gone up from $123 billion to $155 billion in the last one year. This means that companies can borrow easily outside as the cost is less in terms of interest rates. India is a very favoured place and people are willing to fund. Once the money is brought into the country it is not used immediately for projects. This is because of the environmental clearances, the delay in processes and because of lack of land availability, among others. As a result they put it into the treasury. Further, with more money coming in and rupees being released, inflation goes up. When inflation goes up, interest rates go up and one gets more money for keeping funds in the bank. The currency appreciates and that creates more demand for dollars. More dollars come in. It’s a vicious circle. The solution is very clear. Do not allow ECBs to be converted into rupees. But allow ECBs only for imports or for acquisitions overseas. Don’t allow the use of ECBs for the next one year for local assets or working capital. It is just a small stop-gap arrangement. Then I think the situation will improve.
Related Stories: More Stories on : Outsourcing | Interview | Forex | Infosys Technologies Ltd
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | The Hindu ePaper | Business Line | Business Line ePaper | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2007, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|
