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Thursday, Aug 22, 2002

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Nasscom sees pricing pressure bottoming out

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THE National Association of Software and Service Companies (Nasscom), a grouping of Indian software exporters, feels that "there are indications of pricing pressure bottoming out," its president, Mr Kiran Karnik, has said.

"Pressure from the customers have eased a bit and things are beginning to look up," Mr Karnik said. "A little bit" of pressure is likely to stay for a "few more months" and the upswing is likely to happen with overall US economic recovery, boosted by consumer-led spending in the festive season in December, Mr Karnik said. However, the IT recovery is likely to be slower than recovery lift-up, he said, adding that excess capacity in the market will deter a speedy recovery in the IT segment.

However, Mr Karnik said that Nasscom would stand by its earlier guidance of the domestic industry growth at 30 per cent in the current financial year, unruffled by recent travel advisories following border tension with neighbouring Pakistan. "There could be some lags in business flows, but there have not been any order cancellations... that's what I've got as feedback," Mr. Karnik said.

Referring to the proposal of top Indian software exporters bidding as a consortium for big global orders, Mr Karnik said, "There is big virtue in big players coming together and the consortia approach is possible." Top domestic players could also partner with foreign firms for such bids.

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