The Hindu Business Line : No cuts yet on US tech spend: TCS

Available indicators on technology spending in the US suggest that there is no intended reduction in budgets just yet, says Mr S. Ramadorai, CEO, Tata Consultancy Services (TCS).

October-November-December is the budgeting time in the US and any latent dissent against normal trends would have come out loud and clear by now, Mr Ramadorai told Business Line here.

"Nobody is suggesting that IT budgets be pruned to shift focus instead on global development, internal efficiency and transforming business," he said.

TCS has been able to come out largely unscathed from the sub-prime crisis.

But there is no denying the fact that are some implications to the financial services and banking sector as a whole. "But we have not been impacted as we speak," Mr Ramadorai added.

`NEAR-SHORING'

Describing the `near-shoring' trend as an evolutionary phase in the IT revolution, he said that India would continue to be an attractive destination for customers.

"It's the Indian IT industry led by TCS and others that invented the offshore model. Now we find that multinationals are adapting to this model."

"We have since redefined our strategy to suit what we call the Global Network Delivery Model (GNDM) under which we are moving out of the country to regions such as Latin America and Eastern Europe.

The reason is proximity to market as well as the cultural and linguistic milieu that will help us identify better with our customers."

GNDM is significant in that the customers have a choice for de-risking business when they don't want to confine all spends to India.

They need just look around to find the facilities that TCS has put up in other parts of the world.

LEAST PAID?

Mr Ramadorai differed with the recent survey findings that IT employees in India are among the least paid.

"If you look at the purchasing power parity and the compensation that the IT sector is offering to employees, they are in very much in line with the international compensation. The cost of living, the opportunity to live in the city of choice and the kind of rewards and recognition the sector offers are attractive," he said.

Another argument being put forward is that wages in India are increasing and will overtake those in the US or Europe.

"But we have done our own studies to find that India will continue to be competitive for another eight to 10 years".

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