Kris Gopalakrishnan says India’s IT sector can recover.
The hiring by top Indian IT companies declined in 2016 as a result of a slowdown in growth, said a research report published by Kotak Institutional Equities.
According to the report, top four Indian IT companies hired 14,421 professionals in September, 43 percent less than last year, reported Press Trust of India.
Hiring in the first half of this financial year also showed 24 percent decline compared to last year.
“Total hiring by the top four Indian IT companies in the September quarter was at 14,421, down 43 percent (Y-o-Y). Hiring in the first half of this fiscal was down 24 percent to a net of 29,686,” Kotak Institutional Equities said.
The report noted that the decline in hiring is mainly due to the slow pace of growth of the companies. The trend is “consistent with a slowdown in growth rates and efforts of Indian IT to drive up productivity”.
With deteriorating macro-environment, IT companies reported weak second quarter results with growth rate being the lowest in recent years.
“The most recent quarter was weak for all companies with the underlying common theme of project deferment and macro uncertainty impacting different verticals with the possible exception of the telecom vertical,” the report said.
IT companies are losing business as clients like large financial service companies have started shifting software development and maintenance work to their own captive centers.
While the IT industry is passing through a gloomy period, industrialist and one of the founders of Infosys Kris Gopalakrishnan said that India’s IT sector can recover from its current phase of slowdown.
“I am very confident in saying Indian IT industry will continue to be an engine for job creation. It will continue to grow. It can grow in double digits,” Gopalakrishnan told PTI.
“IT services growth has come down. This year (2016-17), it looks like 8-9 percent growth rather than 12-15 per cent. Next year, it will depend on global economy. If global economy picks up, so will IT industry,” he added.
Rejecting the apprehension that the golden era of Indian IT is going to end, Gopalakrishnan said that no other industry is creating one lakh or two lakh good-paying jobs.
“Which other sector (other than IT) is creating one lakh or two lakh good-paying jobs a year? I wouldn’t say golden era of Indian IT services industry is over,” he said.