Focus on critical services key to tide over slowdown: KPMG

Indian IT firms should tighten their belts and focus on core services along with critical services as other countries are catching up amid the economic slowdown.
    
"Other countries like Vietnam, the Philippines and China now offer plain vanilla services like system management as they offer a cost advantage. Though companies still depend on India for critical operations like account management, but Indian IT companies should also look at this area," KPMG Executive Director (IT/ITeS) K K Raman told PTI.
    
Nasscom had recently cut its forecast of India's IT and BPO export revenue and said it is expected to grow by only 16-17 per cent during fiscal 2009 to $47 billion, against close to $50 billion estimated earlier on the back of global economic turmoil and tighter IT spends.
    
"Even though the growth is just 15 per cent compared to 25 per cent earlier, one has to realise this is over a larger base and the number is still a significant one," Raman said, adding, the slowdown in the sector is expected to continue through 2010.
    
"After 2010-11, the situation should get better as India is still the preferred choice for critical services because of the quality if the services offered," he said.