Let us look at the fundamental reason why the IT industry in India came into existence and is a lucrative field for so many business houses in India.
- Although the technology is from the west- the USA being the most powerful resource generator, availability of cheap labour and above-average intelligence among the Indians presented a profitable prospect to the US business to outsource to India.
- The US businesses looked at shifting to the Indian IT bazaar and make it a hub to provide services to the Asian market.
This led to the establishment and growth of the Indian IT Industry.
Problems faced by the Indian IT Industry-
- With saturation in American Economy, it has become difficult for the IT companies to get more work.
- Eurozone crisis has led to diminishing orders from the area for India .
Future-
With cheap labour and a sound foundation – the Indian IT industry can look forward to some good amount of business for sure, maybe not the growth rate witnessed earlier, but good enough.
NB: Job cuts don’t always completely reflect market – it can be of various other reasons such as a change in business processes, downsizing, poor performance of the employee apart from a temporary lull in the market or a diminishing market growth rate or market saturation or collapse (not a possibility as of now)