Merril says Indian IT cos on uneven growth path
New York: US technology spending cutbacks will benefit Indian software services firms, according to a survey conducted by Merrill Lynch of major corporate technology purchasers. The growth however, may be patchy.

According to Hong Kong-based Merrill Lynch analyst Matei Michalca in a report, titled, ‘Indian Software Services — Growth Could Be Patchy Across Quarters,’ highlighted the findings of a March survey by Merrill showing that corporate technology buyers were giving greater consideration to Indian firms. Michalka contends that CIOs of major US and European companies were using the threat of shifting work to Indian firms as a means to drive down prices paid on computer services contracts.

Indian software services firms combine US consulting with low-cost software programming operations based in India to offer rates that are less than 50 per cent of what US and European-based service providers typically charge, he said.

But he warned that India’s perceived cost-competitiveness might not be enough to insulate it from near-term growth pressures.
He added that any increased consideration of Indian software services contractors as overall growth for ‘01 in technology spending has flattened from previous expectations of around 6 per cent growth on the year.

"IT spending decisions are being postponed and customers are using the weak economy as a leverage to bargain for lower pricing. The silver lining: the projects being approved are those which tend to produce direct cost savings," he said.
Infosys Technologies, Wipro, HCL Infosystems and Silverline Technologies are among the leading Indian software services suppliers.
Back to News Review index page  

Strategic oil reserves for rainy days a possibility says govt
New Delhi: Petroleum minister Ram Naik said here today that the government is considering building of strategic reserves of crude oil to ensure security of supplies in difficult times.

At present, India stores about a month’s crude oil inventories, including reserves for the defence sector while other countries like USA and others keep strategic reserves to meet the country’s petroleum requirement for six months. The minister said international prices and supply had a direct impact on the domestic availability.
India meets around 70 per cent of its 75 million tonnes domestic crude oil requirement through imports. The country’s oil import bill for 2000-01 is estimated at Rs 80,000 crore, the minister said.
Energy consumption in India, the petroleum minister said, was growing at 6-7 per cent against the world average of 1.5-2 per cent, and long-term energy security concerns of the country were being addressed through enhanced exploration and production activities and acquiring oil equity abroad.
The minister said that though oil was freely traded in the international market, volatility in oil prices was enormous, which directly impacted the economic growth of the country.
Back to News Review index page    

Godbole panel recommends renegotiation of both phases of Dabhol
Mumbai: The Madhav Godbole committee appointed by the Maharashtra government has submitted its report to the chief minister of Maharashtra, Vilas Rao Deshmukh. The report recommends that both phases of the Enron-promoted Dabhol power project be renegotiated.
It also recommends that the rate of return be linked to a fixed rupee-dollar exchange rate, as this would bring down tariffs.
The Cabinet, in turn, will place the report on the floor of the legislature. However, this is likely to take place only next week in view of the several holidays this week.
Back to News Review index page