India’s IT industry would like to have a much stable rupee, preferably in the range of 54-56 to a dollar, a comfortable level for the sector.
“In our industry, most of the contracts are on long-term basis and we actually would like the rupee to be far more stable. It (fluctuating rupee) becomes very difficult for us to price long-term contracts,” Nasscom President Som Mittal said on the sidelines of a press conference.
“Nobody expected it to cross 60-mark, or even come closer to it…,” he said.
The National Association of Software and Services Companies or Nasscom is the trade association of Indian IT and Business Process Outsourcing (BPO) sectors.
IT firms had generally hedged against fluctuations in rupee. “You might find some companies gaining in the short-term and some losing,” Mittal added.
For large IT companies, 30-35 per cent of their cost would be in dollar terms, which would include offshore salaries, sales and administration costs, among others.
On the global markets, he said the uncertainty still continues. “The visibility is not right. The reason people are using our services is because they need it.”
Hiring
On hiring, he said that the campus hiring would be split this year with a fair amount of hiring taking place in September, while the remaining closer to business in May-June.
The industry is growing by about 12-14 per cent, which is higher compared with the previous year.
The Indian business process management (BPM) industry is expected to touch $50 billion by 2020 from the present $18 billion, according to Nasscom.
“This would be mainly driven by an increase in global consumer spends. The growth would be about 20 per cent an annum,” said Keshav Murugesh, who heads Nasscom’s BPM Council.
Murugesh, who is also the Group CEO of WNS Global Services, said that the future growth would come from areas such as analytics and finance and accounting (F&A). The BPO process would be gradually moving over to BPM, driven by a rise in global consumer spend.