India: Meltdown, Slowdown and Hopes
Posted : December 17, 2008 at 1:07 am [IST]
Global melt down has started affecting India, if I am to believe media reports. However, the bailouts raining in developed countries starting with US, UK. Japan and China, and the global concern for the possible Depression II may and should reach at some innovative solutions lessening the misery in general as well as its duration.
India’s economists must ponder over how to make so much claimed isolating India from global recession eeffective if at all it is possible. It must focus on its strength, may be on its soft power. IT software services and BPO of the higher end of the activities such as R&D and engineering services may be saviours. Some good news gives hope. India still retains its top position as the “undisputed leader” among the top 30 off shoring outsourcing destinations though many including China are chasing it. It must develop its differentials faster than others.
British drug maker AstraZeneca has awarded India’s Infosys Technologies a five year, multi-million dollar contract for information technology work.
The world’s premier hotel company, Chicago-based Global Hyatt Corporation, has outsourced part of its financial and accounting transaction services to India’s Genpact. It may make others in the hospitality industry to follow the footsteps of global banking and insurance giants who outsourced a large part of their processes to India’s BPO sector to save costs.
Taking the jobs to cheaper locations to remote villages will help BPO companies reduce costs. Interestingly, Rural BPO concept is fast gaining ground in India. The Rs 3,500- salary is a princely sum for these BPO workers. Is it not a great strategy? HDFC Bank, Tata Chemicals, SourcePilani with support from the Birla Institute of Technology and Science, Pilani and pioneers such as Ramalinga Raju of Satyam Computers with initiative GramIT are busy in making BPO rural.
Let media not create confusion when Nasscom assures that there will be no job losses As Vivek Wadhwa predicts,.’even terror attacks and a global recession will deter an impending revival of Indian outsourcing or a reshaping of the industry into a provider of high-value, unique services’.
Further Indian auto component manufacturers that have built a lot of capability and scale must get into aggressive marketing mode to cut down its cost and overwhelm over the competitors to get the leading position worldwide as vendors. Let them not resort to traditional actions such as downsizing and retrenchment causing abrasive relations rather they must concentrate on training for multiskilling, and improving productivity through innovative measures. As reported, the cost pressures building up for global auto companies during the current economic slowdown could well be accelerating the pace of sourcing from India. The better image of quality and engineering excellence along with the low cost may be selling points. Fiat, Renault, BMW, and many may prefer India as source.
Some of the MNCs in auto sectors may be cautious in going ahead with expansion and investment. But they can’t ignore the advantages of emerging India. It is very much evident when Renault-Nissan announced the plan to scale up its research facility in India. No one can any more stop India to go ahead.
Indians at work are behind this confidence. Interestingly, according to a recent research conducted by the Kenexa Research Institute (KRI) based on a randomly selected group of over 16,000 workers from 12 countries indicate that employees in India have the highest level of confidence in their organizations.
Let us take a cue also from Professor C N R Rao, chairman of the Science Advisory Committee to the Prime Minister of India, who said, ”In India, in spite of the economic slowdown, science & technology has done well and has shown steady growth. In the past year or so many positive developments have taken place in the NanoTech field. Even though science is not very attractive monetarily, many youngsters have shown great interest in R&D. The future seems very exciting with large scale applications waiting to happen in NanoTech.”
Many like me are looking ahead with hope rather despair to get over the slow down because of the global meltdown.
- Indra
Category: Industry/Management |
Leave a Comment