Indian outsourcing firms bracing for changes

January 17, 2017
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Dive Brief:

  • Infosys Ltd. pared its revenue growth projections for 2017 due to an increasingly unpredictable political atmosphere in both the U.S. and the UK, Reuters reports. Infosys is India’s second-largest software services exporter, and the U.S. and the U.K. are its two biggest customers.

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    Dive Brief:

    • Infosys Ltd. pared its revenue growth projections for 2017 due to an increasingly unpredictable political atmosphere in both the U.S. and the UK, Reuters reports. Infosys is India’s second-largest software services exporter, and the U.S. and the U.K. are its two biggest customers.

    • Late last week, Infosys said it expects revenue to grow between 8.4% to 8.8% this year. Earlier, the company had predicted an increase of between 8% and 9%. India’s software services sector is worth $150 billion, according to Reuters. 

    • Even with the anticipated changes, Infosys’ CEO Vishal Sikka expressed hopes that the incoming U.S. administration will have policies that are “friendly towards business, innovation and entrepreneurship,” The Times of India reports“Of course, visa policies and immigration related policies may change and we have to watch and see what happens there.”

    Dive Insight:

    Brexit in the UK and the election of Donald Trump in the U.S. are expected to cause enterprise customers to curb technology spending. In the U.S., Trump has also promised to reform the H-1B program, which companies like Infosys and its competitors use to deploy tech workers to the U.S. to service clients.

    All these factors could have significant effects on India-based outsourcing companies. But the companies appear to be preparing for potential changes. Sikka recently encouraged his employees to welcome automation and become more innovative or face becoming “obsolete by the tidal wave of automation and technology-fueled transformation.”

    Sikka has also indicated his company is preparing to hire more local workers to service customers in the U.S. and the U.K.


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