The Hindu Business Line : Overseas IT clients unfazed by war talk

New Delhi, Dec. 29 Overseas clients of Indian IT companies seem unperturbed by the recent reports of a military build-up and speculation over possible India-Pakistan conflict.

According to industry, the clients — who are in the midst of the holiday season — do not appear overtly worried and enquiries, if any, on the situation only surfaces during informal conversations.

“Clients are not worried at this point,” said a top official of a leading Indian IT company, when asked if the company has been approached by its customers on business continuity issues. “It is difficult to speculate what happens tomorrow, we will have to wait and watch on how the situation unfolds,” said the official whose company has entered into a silent period ahead of the third quarter results.

When contacted, the Nasscom President, Mr Som Mittal, said the clients are well aware of India’s posture, in the aftermath of the terror strikes in Mumbai. “At the same time, they are also aware of US’ intermediation effort. I do not think they are worried. Also, over the last two days, we have seen some de-escalation,” he said.

Disaster recovery

The industry has robust disaster recovery and business continuity processes in place, he pointed out. “This is true across centres, cities and depending on the criticality, also across countries. Large Indian IT companies have footprint worldwide,” Mr Mittal pointed out.

A CEO of a Gurgaon-based telecom software company said the holiday season in the US had much to do with clients’ response. “Besides that, the global spotlight is more on the financial crisis, and slowdown. Only one or two customers have made enquiries and that too during a casual conversation,” he said.

Another senior industry representative who did not wish to be named agreed that the holiday season had diverted some attention. “Because of the holiday season there is not much activity or even travel. So we are yet to see queries from clients,” the official said.

At present, the US and UK are key markets for the Indian IT and BPO industry, accounting for nearly 80 per cent of the overall export basket.

According to Nasscom’s Strategic Review 2008, while the US and UK account for nearly 61.4 per cent and 17.8 per cent respectively, the Continental Europe chips in 12.3 per cent, the Asia Pacific region 6.4 per cent, with the rest of the world at 2.1 per cent.