Spells in Banglore

My view is that the deadly terrorist attacks at Mumbai’s financial district are not the main cause for the struggling Indian economy. Even before it, the economy was already struggling when the real GDP was expanding at 7.6% in the 3Q – the slowest pace in four years and was well below the 9% growth average for the last three years.

The Reserve Bank of India has been aggressively cutting rates to keep its economy on track and much like our politicians, the government is embarking on a stimulus-seeking spending spree, suggesting that India shares our same slowdown worries.

Mumbai may be India’s financial centre, but the lucrative high technology centre is in Bangalore. It has become the Silicon Valley of India being the back office of the world, handling customer service calls, process payments and writing the code that runs much of global corporate’s software. The global slowdown has already being reflected in reducing hiring, freezing salaries, postponing new investments and laying off thousands of programmers and call centre operators.

Infosys – India’s second largest software services exporters gets two-thirds of its business from the US. One-half of that is from financial corporates like Citigroup and Bank of America. It is recently scaled back its earnings projections for the year and that’s way below the 30% growth of recent years. Satyam Computer – India's fourth largest exporter is cutting its 2009 recruitment plans from 15,000 to 10,000 and has suspended travel for all but the most critical needs.

Interestingly to note also because of changes in the IT world, the arranged marriage trend also changed accordingly. According to a matchmaker friend of mine in Bangalore, bridges’ families are not accepting grooms from this background because there are no job guarantees for IT people. This happens for the last six months.