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Money News

Nasscom may cut India's tech growth forecast for FY09

Engineers work in the control room at Infosys Technologies campus in Bangalore in this January 2003 file photo. Indian software and services growth could be slower than expected in 2008/09 as a global financial crisis crimps demand for such services, the National Association of Software and Service Companies (Nasscom) said. REUTERS/Pawel Kopczynski

NEW DELHI (Reuters) - Indian software and services growth could be slower than expected in 2008/09 as a global financial crisis crimps demand for such services, the National Association of Software and Service Companies (Nasscom) said.

Nasscom may revise its growth projections in December, a top official said on Monday. The association in July had forecast revenue growth between 21 percent and 24 percent to about $50 billion in the year to March 2009.

“There will be short to medium-term impact, which we define as three to four quarters. I won’t be surprised if the numbers are tempered down,” NASSCOM President Som Mittal told reporters.

The U.S. financial system was shaken after the collapse of Lehman Brothers and the rescue of American International Group rattling Indian outsourcing firms who earn roughly half their revenue from U.S.

However, the financial turmoil has led India’s information technology firms to explore new territories in Europe, Asia and Middle East to lower their dependence on the United States, Mittal said.

The U.S. government’s $700 billion bailout fund to buy bad debt is likely to lead to recovery of the markets, Mittal said.

“We are hopeful that whatever impact is there is limited to short to medium term,” he said.

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