Stir after Wipro asks techies to join BPO

30 Nov 2008, 0149 hrs IST, TNN

KOLKATA: They were aware of the slowdown, but none thought it would sting so soon. Assured employment as project engineers by Wipro in 2007, these budding engineers didn't know their careers would go into free fall.

Hundreds of students from different engineering colleges staged a dharna in front of the Wipro SEZ area in Sector V on Saturday morning after the company asked them to join its BPO shop at half the salary they had been offered initially. At the dharna, the students were waving copies of the company's revised letter, which they got a few days ago.

"As project engineers, we are supposed to get Rs2.75-3.25 lakh a year, while as a BPO employee, this has been reduced to Rs1.2-1.6 lakh annually. We will be demoted to a BPO staffer. We're aware of the meltdown, but are not willing to compromise on job profile," said Gourab Saha, from JIS Engineering College, Kalyani.

According to students, the company had given them offer letters to join as project engineers after campus interviews in 2007. They were promised jobs in February 2009 after they passed out of college.

In a letter to the selected candidates on November 25, Wipro management invited them to join the BPO division in Kolkata. "You would be aware of the current economic environment across all industries including the IT sector. IT analysts and experts claim this scenario is likely to prevail for a while. We have looked at various options to absorb you without much delay," the letter says. The nature of job is that of a "technical helpdesk engineer" instead of "project engineer" as promised earlier.

After getting the letter, confused students rushed to the Wipro office on Thursday to meet HR officials. The meeting was futile. Company officials allegedly took a take-it-or-leave -it stand and said they were not going to consider the cases of those unwilling to join the BPO.

Students then staged the dharna in front of Wipro office on Saturday expecting the Wipro management to take a flexible stand. Many among the agitators were ready to work for a reduced salary, but not in the BPO division. "We told HR that we are ready to accept a reduced pay structure. But the company should give us the designation offered initially," pleaded Saikat Chakravorty, a student from Institute of Technology and Marine Engineering.

The agitators are ready to wait another six months. They pleaded with the company not to cancel their appointments if they did not join the BPO. "At present, it is mandatory to join the BPO, otherwise they will strike off our names. During Saturday's meeting, we told them we were willing to wait a few months to join as engineers," said Sayantan Mukherjee, a student from Bengal Institute of Technology, who went to talk to Sonal Bharadwaj, regional HR head of Wipro. "Bharadwaj gave us a patient hearing but didn't promise anything. We've been asked to get in touch with HR by December 2," said Sayantan.

Wipro Technologies vice-president Pradeep Bahirwani said: "Due to current business scenario we estimate delays in joining dates of some batches of recruits. We are providing them an option of a role in our BPO division. The objective is to let engineering graduates commence work without delay."

Shivraj Patil resigns, Deshmukh may go next

New Delhi: Union Home Shivraj Patil, facing fierce criticism over spate of terror attacks in the country since 2007, accepted 'moral responsibility' and sent his resignation to Prime Minister of Manmohan Singh on Sunday.

Party sources have confirmed that his resignation has been accepted and added that Maharashtra Chief Minister Vilasrao Deshmukh could be next to be asked to step down.

There have been several terror attacks in the past, but due to the nature of Mumbai attacks and the fact that it is an election season, someone needed to take responsibility, party sources said.

There is speculation that Finance Minister P Chidambaram and External Affairs Minister Pranab Mukherjee are the top contenders for Patil’s post.

PMO sources told CNN-IBN that the party is considering significant changes in the Home Ministry. "Some bureaucrats are expected to be reshuffled soon," they said. There is also pressure mounting on the National Security Advisor M K Narayanan to quit because of repeated intelligence failure.

Patil offered to quit after Congress Working Committee (CWC) members expressed their dissatisfaction with the Home Ministry in the wake of Mumbai terror strikes, at a meeting held late on Saturday.

Patil told the meeting that as the Home minister he "takes the responsibility and whatever the CWC decides, I am ready to do", party sources said.

Patil's remarks suggested that he was ready to step down came in the wake of criticism by several leaders including union ministers over the way the internal security situation was being handled at the Central level, the sources added.

Sources say that CWC members came down heavily on Patil and Maharashtra chief minister Vilasrao Deshmukh for their failure.

UPA chief Sonia Gandhi and Prime Minister Manmohan Singh are believed to have pulled up Patil for the monumental intelligence failure in Mumbai terror strike case.

It is said that Patil's ministry failed to take cognisance of a serious input from intelligence about the impending attack long before terrorists struck Mumbai on Wednesday night, November 26.

HEADS WILL ROLL

Besides Patil, Maharashtra Chief Minister Vilasrao Deshmukh, who was also present at the meeting, came under attack on the terror strikes issue, CWC sources said.

The leaders who voiced criticism on the issue included union ministers P Chidambaram, Kamal Nath, Kapil Sibal and H R Bhardwaj, they said.

The refrain of these leaders at the meeting was that strong action is needed in the wake of the Mumbai terror strikes and accountability has to be ensured at the higher as well as lower levels.

This prompted Pranab Mukherjee to remark that since it was collective responsibility of the Cabinet, he would also like to take responsibility as the External Affairs Minister.

Maharashtra Chief Minister, however, chose to ignore the criticism and instead apprised the meeting of the steps taken by his government in the wake of terror strikes, they said.

The Home Minister as also National Security Adviser M K Narayanan came under attack at the CWC meeting called hours after the security operations against the terrorists was indication enough that the leadership was planning some strong steps.

(With inputs from PTI)

Are you a Brahmin? A terrorist asked him

A correspondent in New Delhi

November 29, 2008 16:28 IST

K R Ramamoorthy can't thank his lucky stars enough. One of the unlucky guests at the Taj Hotel, that fateful evening, Ramamoorthy stared at certain death, and survived.

When a terrorist knocked on his door, he hardly knew what lay in store for him. After barging into his room, the terrorists asked him, "Are you a brahmin? Your name sounds south Indian."

The seventy-six year old banker tried to hoodwink the terrorist and told him that he was a school teacher and hailed from Bangalore. But the terrorist who spoke fluent Hindi and English turned out to be smarter than he had imagined.

"How can a school teacher stay in a posh hotel like this? Who paid your rent?" he asked.

And without waiting for Ramamoorthy's reply, the terrorist hit him, before declaring with a chilling finality, "You are duping us."

It was then that Ramamoorthy saw the second terrorist. He had five employees of the hotel with him. The employees had their hands and mouths tied, and were crying. But the terrorists showed no emotion and continued to speak with each other 'quite jovially'.

Help finally came at 6 am on Thursday morning. Ramamoorthy saw a fire engine ladder outside his room. He waved his hand to the driver of the fire tender, who urged him to pull-down the curtains and tie them to the window. He then signaled Ramamoorthy to come out through the window.

While he was climbing on to the ladder, he saw a woman outside (the window) of her fifth floor room. They both got down with the help of the firefighters, and ran to safety. Their ordeal of over eight hours was finally over.

A relieved Ramamoorthy then called his wife and told her that he was safe.

The non-executive part-time chairman of ING Vysya Bank, however, rues that he had to leave his luggage and mobile phone in the hotel room.

Mumbai’s Longest Night, With an Abyss of Terror

By SOMINI SENGUPTA and JEREMY KAHN

Published: November 27, 2008

MUMBAI, India — For Amit and Varsha Thadani, Wednesday night in the Crystal Ballroom of the Taj Mahal Palace & Tower Hotel was supposed to be a night they would treasure forever: the lavish start of a life together, with a wedding reception for over 200 family and friends.

Slide Show

It may be an anniversary they will dread forever.

About 9:45 p.m., as they had just finished dressing for their party in a second-floor room in the Heritage wing of the hotel, they heard the first crackle of gunfire, followed by commotion outside their room and instructions from the hotel front desk to stay put.

They did stay put, for more than seven hours, much of it huddling on the floor of their bathroom, trying to keep themselves calm. Their phones rang constantly, with updates and questions. At one point, Mrs. Thadani confessed, she stopped answering. She did not want to talk to anyone. There was more gunfire, along with two loud explosions, one of which flung open their door and windows. Next door, they heard gunmen shoot a female guest and then her screams.

“We could sense she was being dragged around,” Mrs. Thadani recalled.

In the Crystal Ballroom, friends had begun trickling in. They, too, were startled by gunfire. Could it be firecrackers? one wondered. A window shattered, sending everyone scampering under tables, and then eventually, led by hotel staff members, into a private, less accessible set of rooms. Ballroom by ballroom, restaurant by restaurant, guests were ushered into what was thought to be a safer cavity of the hotel, a private club called The Chambers.

At the Golden Dragon restaurant on the ground floor, a woman could see through the frosted glass the gunmen parade through the lobby of the hotel and open fire, any which way. She had come to celebrate her husband’s birthday, along with both sets of parents.

They, too, were led through kitchens and staff stairwells into safer quarters, where they huddled until nearly 4 a.m. She and her parents slipped out through the back staff exit, but with so many cellphones trilling, they drew the attention of the gunmen inside the hotel.

They began firing at those trying to flee. Her husband and his parents got left behind. Eight hours later, in the shadow of the hotel, she stood waiting for them to come out. Her husband did not answer his cellphone. She was still dressed in her black dinner blouse.

The chaos at the Taj was just one part of the abyss of terror that swallowed the city.

At Leopold Cafe, a restaurant popular with foreigners, a Belgian tourist, here to indulge his love of Bollywood, described the sudden awareness of deathly peril and the desperate actions of the staff members to protect their foreigner customers.

The tourist, Ronny Quireyns, 44, was seated in the air-conditioned upstairs with friends — film extras just coming from a shoot — on Wednesday night. A little before 10 p.m., they heard a loud blast outside; they immediately thought of a bomb, but the noise seemed too faint. But then they heard a series of sharp bangs from downstairs, he said. “A member of the staff rushed upstairs and said there were people shooting downstairs,” Mr. Quireyns said.

The waiters pulled the cover off an air-conditioning vent and guided him and about 15 other foreigners to climb inside, he said. After about 10 minutes, Mr. Quireyns said, he crawled out and peered down the stairway to the floor below. He saw people writhing on the ground.

Finally, the waiters gave an all-clear, he said, and the foreigners fled the restaurant, where blood now covered the ground floor. Police officers took them to a nearby station to spend the night.

“It was really frightening,” Mr. Quireyns said. “It seems so surreal. You never think something like this will happen to you.”

Gary Samore, director of studies at the Council on Foreign Relations in New York, was staying at the Taj with his wife and daughter, squeezing in a family holiday in Mumbai alongside a lecture that he delivered earlier on Wednesday evening on the nuclear challenge facing the next president of the United States. They, too, stayed in their room and tried to stay calm.

The television was not working. He had no local phone. Friends kept him apprised of developments by sending e-mail messages to his BlackBerry. At 3:30 a.m., Mr. Samore recalled, very heavy gunfire began. The American Consulate called to say the hotel was on fire. The family collected their passports, made a set of wet towels to help them get through a smoky corridor and found their way to a service stairwell and then a second-floor terrace, from where they could summon Indian soldiers.

“My BlackBerry,” he said, “may have saved our lives.”

In the kitchen of the Chambers, Raghu Deora, the chef, hid under a table. Four gunmen came before dawn and found him. What do you do? they asked in Hindi, and then they ordered him to stand up and turn around. They shot him from behind, his wife, Nandita, said Thursday afternoon. A bullet entered through one side and came out of the other. There were four gunmen, he told her while recovering in Bombay Hospital, all in their mid-20s, well dressed.

Close to dawn, Mr. and Mrs. Thadani, the bride and groom, crept out of the window of their room, and with the help of firefighters, climbed down a ladder and touched ground. On Thursday afternoon, they counted their blessings and ate a homecooked meal.

26/11: MUMBAI ATTACKED (In Pics)

http://ibnlive.in.com/mumbaiattack/photoshow.php?id=1125&n=13

India's political leadership to blame: Wall Street Journal

New York: India's ruling United Progressive Alliance (UPA) has done little to launch an effective fight against terrorism and may "pay a price for its incompetence" in the elections next year, the Wall Street Journal said in its lead editorial on Friday.

"A lack of political leadership is to blame," The Wall Street Journal said as India's financial capital continued to battle terrorists who had struck in 10 places in the city Wednesday.

The Mumbai terror attacks, in which at least 125 people have been killed, have been covered extensively in both the print and online edition of this New York-based daily financial newspaper.

"It (the ruling party) may pay a price for its incompetence at the national polls next year," the newspaper said.

"Yesterday Prime Minister Manmohan Singh promised that 'every perpetrator would pay the price'. Yet his Congress Party has done little more than bicker with its coalition allies over the past five years on how best to fight terrorism," the journal said.

Observing that the attacks are a reminder that India is at the top of the terror target list, the newspaper said this is because India is an easy target.

Not only are its intelligence units understaffed and lack resources, coordination among State police forces is also poor. "The country's anti-terror legal architecture is also inadequate; there is no preventive detention law, and prosecutions can take years," it said.

"Wednesday's attacks should arouse Indians to better confront the terror threat, while reminding all democracies how dangerous that threat still is," it said.

In another opinion piece published by The Journal, author Sadanand Dhume blamed the Congress for scrapping the anti-terror law POTA. "On taking office in 2004, one of the first acts of the ruling Congress Party was to scrap a federal antiterrorism law that strengthened witness protection and enhanced police powers," he wrote.

"The Congress Party has stalled similar state-level legislation in Gujarat, which is ruled by the opposition Hindu-nationalist Bharatiya Janata Party. And it was a Congress government that kowtowed to fundamentalist pressure and made India the first country to ban Mumbai-born Salman Rushdie's 'Satanic Verses' in 1988," he said.

Dhume, a Washington-based writer and author of "My Friend the Fanatic: Travels with an Indonesian Islamist", said the Indian approach to terrorism has been consistently haphazard and weak-kneed.

US dispatching FBI team to Mumbai

Press Trust of India

Friday, November 28, 2008, (New York)

The US is rushing a team of FBI investigators and forensic scientists to Mumbai ascounter-terrorism.
Officials were reported to be stunned at the level of coordination in the terror attacks in the city.

The FBI team would coordinate with Indian intelligence and security agencies about the planning and evidence collected on the attacks.

The US officials estimate that the widespread carnage could have been carried out for relatively small price tag between USD 100,000 and USD 200,00O which, they say, is the cost of machine guns, grenades, ammunition and boats used.

The television network said intelligence agencies around the world are scrambling to identify the source of this latest threat in view of the "remarkable" coordination and sophistication.

The command centers, set up by terrorists in places they attacked, may have allowed them to communicate from site to site. The attacks, US officials said, appear to mimic Al Qaeda tactics simultaneous attacks on high profile targets in the heart of the financial district.

What is deeply disturbing to US law enforcement officials, is that these militants may now be targeting Westerners, particularly Americans, to draw attention to their cause, despite not having a specific grievance against the United States.

Rescued Iraqi citizen thanks commandos

November 28, 2008 12:38 IST

"I am hungry and thirsty," said Muneer Al Mahaj, one of the hostages who came out of Oberoi hotel on Friday morning.

"Let me eat first. I have not seen a proper meal for the last 36 hours. I have been surviving only on biscuits and that too got over. Last night, I ran out of water too," said Muneer.

Muneer, an Iraqi citizen, was in Mumbai for a business trip with one of his friends.

He was staying on the fourth floor of the Oberoi hotel when the terrorists stormed the hotel. Muneer was one of the 93 hostages that were released from Oberoi hotel on Friday morning.

The Oberoi hired special luxury buses for all their guests and took them to another hotel.

"I cannot believe what I have seen in the last 36 hours. I have seen dead bodies, blood everywhere and only heard gunshots," added Muneer.

He, however, said that he did not see any terrorists.

Muneer was staying on the fourth floor of the Oberoi hotel when terrorists entered the hotel.

"First I thought it will get over by next day morning, but I could not believe that these terrorists took all of us hostage fore more than 36 hours," said Muneer.

Asked him what was his worst fear in the last 36 hours, he said, "The thought that I will not be able to live and see next day. This thought kept cropping up every moment and we all were very close to death and lucky to survive."

Did you think of escaping?

"I thought so but could not do as there was firing all the time. I could not take a risk and the same was the case with many other people."

He was very grateful to Indian commandos, "They did a very commendable job. They made us feel safe."

So will he make a next trip to Mumbai, "Sure. Why not? I love Mumbai and Indians. I found them very friendly."

Top 5 cos in Deloitte's 2008 Tech Fast 500

http://economictimes.indiatimes.com/quickiearticleshow/3759805.cms

Wipro to recruits: Join BPO for now

27 Nov, 2008, 1424 hrs IST,TNN

BANGALORE: India’s third largest software exporter Wipro is asking its latest batch of recruits from engineering colleges if they want to join its business process outsourcing (BPO) division instead of the technology services unit for which they were originally hired.

Wipro said it is offering the option because it sees delays in the joining dates for some batches of recruits due to the ‘current business environment.’ According to sources, the students have been given the option of working in the BPO division for a year and later they could be shifted to the IT services vertical. The salary from the original offer remains unchanged.

“Every year campus joining is spread out over the four quarters. This is done for logistical reasons of training and seating. Staggered hiring programme and timelines are also closely linked to our business. Due to current business scenario, we estimate delays in joining dates of some batches of recruits. We are providing them an option of a role in our BPO division. The objective is to let engineering graduates commence work without delay,” Wipro Technologies’ vice president-Talent Acquisition, Pradeep Bahirwani, said.

He declined to comment on the number of recruits who have been given the option or when they were due to join.

The company has made offers to a total of 14,000 students for the 2008-09 fiscal. Wipro said last month that it expects revenue from its IT services business for the October-December third quarter to remain almost unchanged from the $1.1 billion in the previous three-month period because of the deteriorating global economic situation.

Reacting to the slowdown in the key US and European markets, software industry grouping Nasscom is due to revise lower its forecast of a 21-24 per cent increase in IT services exports during the 12 months to March 2009.

There has been a lot of apprehension among students that the difficult economic situation may result in tech companies not honouring the job offer that have been made. But the country’s top three IT services provider--TCS, Infosys and Wipro--have steadfastly maintained that they will keep their word.

At the end of September, Wipro employed nearly 62,000 staff in its IT services business and about 21,000 in the BPO division. It also makes strategic sense for Wipro to recruit the new engineering graduates in the BPO unit as this vertical regularly witnesses higher attrition rates than the IT services division.

Laurence J. Peter

"Competence, like truth, beauty and contact lenses, is in the eye of the beholder."

TERROR NON-STOP: 101 killed in Mumbai attacks

Published on Wed, Nov 26, 2008 at 22:39, Updated on Thu, Nov 27, 2008 at 11:14 in Nation section

• 2 terrorists killed in shootout inside Taj Mahal hotel
• Terrorists holed up in Trident (Oberoi) hotel, Cama Hospital
• Terrorists struck at 10 places: Desmukh
• Anti-Terrorism Squad Chief Hemant Karkare killed
• 11 policemen, including five officers, killed: Deshmukh
• Army arrives at Hotel Oberoi to flush out terrorists
• Seven foreigners among 15 taken hostage by two gunmen in Taj Hotel
• Firing reported from Hotel Marriott in Colaba
• Colaba: BP Petrol Pump blown up
• 10 killed in Colaba attack
• Taxi blown up in Vile Parle
• Gun battle outside Metro cinema hall
• Hotel Oberoi, Hotel Taj under siege
• Mumbai police say air surveillance ready
• Local trains suspended
• Gunfire and grenades, the latest modus operandi of terrorists
• Roads in Mumbai completely deserted
• Terrorists still holed up at Nariman House
• Crowded areas and buildings one behind another, difficult situation for rescue
• Most Mumbai targets foreigners' favourite hangouts
• PM briefed about the situation by Home department

Mumbai: At least 101 people, including a foreign tourist and a top counter-terror officer, were killed and about 287 injured as terrorists struck in the heart of Mumbai in planned and synchronised attacks.

Terrorists were reported to be holding people hostage in two five-star hotels, the Taj Intercontinental and Trident (formerly Oberoi) facing the waterfront across the Arabian Sea, and the Madam Cama Hostel.

Three top police officials, including Anti-Terrorism Squad (ATS) chief Hemant Karkare, were among the nine policemen killed in gunfights with the terrorists, police confirmed.

Among terror targets was the city's busiest railway station, the Chhatrapati Shivaji Terminus (CST). "This is a most audacious attack. It is a very serious situation and gun battles are still on in at least three places," said Maharashtra Chief Minister Vilasrao Deshmukh.

Deshmukh confirmed early Thursday morning that terrorists had struck at 10 places.

Mumbai Police Commissioner Hasan Ghafoor said the attacks were suspected to be "coordinated terrorist acts", and added that automatic weapons like AK-47 and AK-56 and semi-automatic rifles as well as grenades were apparently used.

Maharashtra government spokesman Bhushan Gagarani confirmed 78 people were killed and 287 injured, many of them grievously.

He said two terrorists were killed in gun battles with police while nine were held.

It appeared that small groups of heavily armed terrorists sneaked into busy public places, mostly in south Mumbai, in the dead of the night spreading panic in the city.

Many of the locations targeted, mostly in upscale south Mumbai, were favourite destinations of foreign tourists, like the Leopold Restaurant in Colaba. The restaurant was riddled with bullet holes and there were blood on the floor and shoes left by fleeing customers.

A list of average IQ's per occupation

Citigroup CEO: Bank 'went wrong' in real estate

Wed, Nov 26 09:10 AM

NEW YORK (Reuters) - Citigroup Inc Chief Executive Vikram Pandit on Tuesday blamed prior management for diving too deeply into real estate, causing losses that led to this week's massive government bailout of the second-largest U.S. bank by assets.

"What went wrong is we had tremendous concentration in the sense we put a lot of our money to work against U.S. real estate," Pandit said in an interview on PBS' Charlie Rose show. "We got here by lending money, and putting money to work in the U.S. real estate market, in a size that was probably larger than what we ought to have done on a diversification basis."

The government late Sunday rescued Citigroup by agreeing to shoulder most potential losses from a $306 billion portfolio of risky assets, and by injecting $20 billion of new capital, in its biggest effort to prevent a large U.S. bank from failing.

Citigroup has lost $20.3 billion in the last year, and many expect further losses from credit cards and other areas tied to the global economic crisis to pile up.

Since closing Friday at $3.77, Citigroup shares have risen 61 percent, and closed Tuesday up 13 cents at $6.08 on Monday. They have nevertheless tumbled 79 percent this year, after closing last year at $29.44.

Pandit said in the interview that short-sellers, as well as investors worried about Citigroup's asset quality, were among those who drove the bank's shares down in recent sessions, and that it was important "that we got control of the situation."

"I can completely understand how people on Main Street, people who are not close to this industry, would be furious at what's happened," he said.

Some wealthy investors have begun or pledged to begin buying Citigroup shares.

A Mexican brokerage controlled by Carlos Slim, one of the world's wealthiest people, spent about $150 million to buy nearly 29 million Citigroup shares between Nov 19 and Nov 25.

Meanwhile, Saudi Prince Alwaleed bin Talal last week said he plans to boost his stake in the bank to 5 percent from less than 4 percent.

(Additional reporting by Noel Randewich and Armando Tovar in Mexico City)

Take a sabbatical, Infosys tells employees

India's second-largest information technology services provider, Infosys Technologies, has issued letters to its employees stating they could opt for a one-year sabbatical to engage themselves in philanthropic activities. They would continue to draw 50 per cent of their salary during the period. Infosys crossed the 100,000-employee mark in India in the quarter ended September 30, 2008.

The company said that while the move may have coincided with the global financial turmoil and slowing growth rates of IT firms, it should be perceived as a pure voluntary act by employees who are prompted by altruistic motives and inspired by the example of its chairman and chief mentor, NR Narayana Murthy.

The employees, an internal memo said, need to be on the company rolls for at least two consecutive years before they are eligible for the offer and a panel comprising senior members of the Infosys leadership team will decide each case. "This policy will promote volunteerism among employees and we believe that the value and benefits arising from it will have an impact on community, the employees and ultimately, the company," it said.

Sources said that the policy came into force only a few days ago and the company is working out the finer points like whether the employees will be given any salary or emolument during the sabbatical. However, it is understood that the company is planning to pay some amount of the salary, while the rest the employees can earn from the NGO they are working for.

An Infosys spokesperson confirmed the development: "We introduced this policy almost two months ago, which allows employees to go on up to one year of sabbatical to engage in philanthropic activities. All employees have been communicated the policy internally."

When asked how much the employees will be paid during that time, the spokesperson said they will be given 50 per cent of the salary, while the other half will be given by the respective NGOs they work with.

"It's a part of Narayana Murthy's desire to give back to society, which is driven by the fact that many employees quit their jobs to pursue philanthropic activities. This would give such employees an option to pursue their hobby while still continuing with the jobs, even if they will be paid a small amount by the company. The employees can go out with a cut in their salaries, even though the final details are being worked out by the company," a source close to the development said.

Infosys has a good deal of exposure to the sectors which have been worst hit by the current global economic meltdown such as banking and financial services, telecom and retail. In the last quarter, the company had announced that some of its clients in their sectors are coming back to re-negotiate. In a recent report, brokerage house CLSA had forecast that Infosys might miss its dollar revenue guidance for the third quarter, and may even post a sequential fall in the quarter.

The CLSA report also acknowledged that the flow of IT deals from the BFSI segment has "worsened substantially" and that long-term deals are being offered on "very tough terms", thus putting pricing under serious threat as customers play one vendor against the other.

‘Property slowdown to have ripple effect’

This can impact economy, says Goldman Sachs.

BL Research Bureau

The ripple effect of a slowing property market is likely to result in a substantial impact on the Indian economy, states a report by the Asia Economics Research Team at Goldman Sachs.

Strong linkages

According to the report, a slowdown in the realty industry results in an inevitable slowdown in construction activity. While construction activity accounts for 7.3 per cent of the GDP, the sector’s multiplier effect would be felt in other industries that account for an estimated 14 per cent of the GDP.

Construction has strong backward linkages to sectors such as iron, steel, cement and forward linkages to segments such as hotels, trade and transport, thus bringing about a ripple effect.

The report estimates that the realty sector along with its linkages will reduce about 0.7 percentage point from India’s GDP in FY09 (compared to previous year) and an additional 0.4 percentage point in FY10.

Drawing parallels

The report also draws parallels to the previous cooling off of the property market in 1996 and the accompanying periods of relatively low economic growth.

It is to be noted that during 1994-95, India’s GDP growth had shot up to 6.4 per cent, a sharp acceleration from the less than 2 per cent growth in 1991-92. The country was also challenged by double digit inflation. Interest rates, then too, were raised to contain the inflation leading to turmoil in the property market and an overall liquidity crunch. With constrained money supply as well as demand, the country’s GDP declined to 4.3 per cent in 1997-98.

According to the Goldman Sachs report, residential real estate prices on an average rose 70 per cent cumulatively over the three years preceding the property bust in 1996 and declined by a cumulative 40 per cent in three years after 1996. The report notes that it took a good five years for the prices to recover from the slump.

Placed in a similar context, residential property prices over the last three years to 2008 have surged by a total of 80 per cent on an average. Inflation-adjusted real estate prices in the four major cities of Delhi, Mumbai, Kolkata and Chennai have also gone past the previous peak in 1996.

The report, released on Monday, suggests that residential property prices in some regions may have to decline by 30 per cent from current levels to improve affordability.

Jonathan Weil: Goldman, GE, GM and a rigged game

ROUND THE WORLD
Jonathan Weil / Bloomberg November 23, 2008, 0:23 IST

The fleecing knows no end. Take a look at General Motors (GM) 8.375 per cent bond due in July 2033, and feast your eyes on the new world of American capitalism. Yesterday’s price, at about 15 cents on the dollar, tells you the market believes GM will last long enough to make a little less than two years’ worth of interest payments.

Were it not for the chance of a government bailout, in lieu of an imminent Chapter 11 bankruptcy filing, the bonds would trade for much less. And there lies the truth about what America’s capital markets have become: a rigged game. You can see it all over. Nobody who knows anything about General Electric Co (GE) actually believes it’s a AAA credit. And yet the raters at Moody’s Investors Service and Standard & Poor’s continue to give GE their highest mark. Meanwhile, the company just landed government insurance for as much as $139 billion of debt for its lending arm, GE Capital Corporation, which also is rated AAA. If GE were really that strong, it wouldn’t need the help.

At American International Group Inc, the $150 billion ward of the Treasury Department, management had the audacity to claim in the company’s latest quarterly report that it “believes it will have adequate liquidity to finance and operate AIG’s businesses.” In other words, AIG’s executives are counting on a blank cheque from the government, should the money run out again.

If you had considered betting against Fannie Mae and Freddie Mac this summer — that is, when the Securities and Exchange Commission wasn’t banning short sales of their stocks — the biggest risk wasn’t that they would surprise investors by turning in a good quarter. It was that Treasury Secretary Hank Paulson or Federal Reserve Chairman Ben Bernanke would show up before Congress to talk up their stocks and squeeze the shorts.

PAULSON’S STING
Your worry is the same if you’re thinking of shorting Morgan Stanley, Goldman Sachs Group Inc or Citigroup Inc. All Paulson might have to do to separate you from your money is call a press conference. And if you bought toxic mortgage bonds, just before Paulson cancelled Treasury’s purchases of troubled mortgage-related assets, you’ve felt his sting already.

When the government let Lehman Brothers Holdings Inc die, there at least was the sense, for a day or so, that somebody very large wasn’t too big to fail. Today we understand better: The government is picking winners and losers. Instead of just a couple giant government-sponsored enterprises, now we have dozens. With so many beggars in Zegna suits lobbying for handouts, it’s easy to see why lots of Americans are aghast at what our country has become.

Many of the companies receiving bailout treasure will get washed out to sea in the end. When we look back on the money showered upon them, whether to fund banker bonuses or preserve Michigan’s share of the Electoral College, we will wish we had saved it, if for no other reason than to preserve the Treasury’s own AAA-credit rating.

MARKET UNDERSTANDING
Think back to the price of that GM bond. It doesn’t imply that a government bailout would be enough to let the automaker continue as a going concern until its bonds mature. What the market understands is that GM will collapse long before then, no matter how much taxpayer money it gets now. In Congress, lawmakers may be fancying a $25 billion bailout for the auto industry. Yet even if they earmarked all that money just for GM, which has $59 billion more liabilities than assets, it wouldn’t make the company solvent.

ADVANCE KNOWLEDGE
So, for the time being, the clearest path to making money in the public markets is to know in advance what the government plans to do next with which companies, and when — and then trade on it. Let there be no doubt: Plenty of people with access to such inside information are enriching themselves this way now. My guess is none of them is named Mark Cuban, and that the Securities and Exchange Commission will never sue any of them.

It’s long been cliche to say the securities markets are a giant casino. This notion hasn’t been explored enough. Aside from the free drinks, the only reason a rational person would play a slot machine in Las Vegas, aware that the house controls the outcome, is because of the mindless entertainment it promises. For ordinary folks with money to burn, this might be the last, best reason to invest in the US capital markets, too. Good luck.

Accenture staff to work longer hours

COMPETITIVE PRESSURE.

Shamik Paul
Vishwanath Kulkarni

Bangalore, Nov. 24 In a bid to boost productivity levels at its India Delivery Centre, Accenture, management consulting, technology services and outsourcing company, plans to increase its work hours by an hour daily from January 1.

The company, in an internal communication to employees, said that after much consultation with the leadership and a careful review of the market place, it has decided to extend the work hour for professionals at its India Delivery Centre for technology from 40 hours to 45 hours a week effective January 1, 2009.

The company told its employees that for the past few months it has been looking at how it can continue to best serve clients while enhancing its competitive positioning, and one of the areas it has been looking at is its work hours.

5-day week

However, Accenture would continue to have a five-day work week. “Doing this (increasing work hours) will enable us to be even more competitive in the market place,” Accenture told its employees.

The India-based competitors of Accenture such as TCS, Infosys and Wipro are now facing uncertain times as customers in the crisis-hit US delay or hold back their spending on deploying new technology, and these vendors are trying to be more competitive.

Accenture officials did not comment on the development. The company employs over 37,000 people across development centres in cities such as Bangalore, Chennai, Hyderabad, Mumbai, Pune and Gurgaon. Its Chairman, Mr Bill Green, said in April that the company would increase India headcount to about 50,000 within a year.

It might be recalled that HCL Technologies Ltd had increased its work hours in October 2006 by 30 minutes from the existing eight-and-a-half hours a day (excluding a half-hour lunch break) to nine hours a day.

The company had said increased work hours will aid employee training besides help the company follow the industry standard of a 45-hour week.

Cricket's bad boy? Symonds involved in a brawl, again

CNN-IBN

Melbourne: It has only taken one Test match on his return to the Australian team for Andrew Symonds to get into trouble yet again.

The 33-year-old all-rounder is reported to have gotten into a physical confrontation with a member of the public in a Brisbane pub on Sunday night.

According to the Sydney Morning Herald, the incident happened after Australia completed a 149-run victory over New Zealand.

Symonds was understood to have been drinking at the popular Normanby Hotel in Red Hill with several members of the Australian rugby league team when the fight commenced.

"The incident is believed to have occurred on Sunday evening, about six hours after the Australian cricket team sealed a 149-run victory over New Zealand in the first Test at the Gabba, and involved a confrontation between Symonds and a member of the public," Sydney Morning Herald wrote in its exclusive report.

Cricket Australia is conducting an investigation and unless Symonds can prove that he didn't start the fight; it could lead to another ban or even the loss of his contract.

"We are getting as much information as possible to establish what did and did not happen. We understand there was an altercation," a CA spokesman said.

The Australian all-rounder has, however, denied that he provoked any member of the public.

"A member of the public acted unreasonably towards me while I was with friends at which time I took steps to remove myself from the situation. The member of the public was subsequently removed from the premises as a result of his actions. I was sharing some drinks with other players and close friends and did not in anyway provoke this situation," Symonds said.

The troubled all-rounder has been hitting the headlines for all the wrong reasons that even cost him his place in the national side, which toured India recently.

He had preferred fishing over a compulsory team meeting when Bangladesh was in the country for a Test series, following which he was asked to attend a rehabilitation programme under CA's insistence.

He won his place back in the side when Australia picked him for the ongoing Test tour against New Zealand.

(With inputs from PTI)

Kurt Vonnegut

"Beware of the man who works hard to learn something, learns it, and finds himself no wiser than before... He is full of murderous resentment of people who are ignorant without having come by their ignorance the hard way."

General Motors is now cheaper than Maruti!

BL Research Bureau

Chennai, Nov. 21 What are some of the world’s largest companies worth after this year’s carnage in the stock markets?

With its stock price taking a nosedive, US-listed General Motors today sports a market capitalisation of just $1.7 billion. That makes it cheaper than Indian car maker Maruti Suzuki, which is valued at $3 billion. Investors should note that GM’s market cap was leagues ahead of the Indian car maker barely 10 months ago, at $14 billion. Ford Motors, with its market cap of $3.3 billion after its recent battering, is now just marginally more valuable than Maruti.

Financials dented

Financials and commodity stocks are the ones to have taken the biggest plunge in values after automobile stocks, in the recent rout.

Citigroup has seen its market cap plunge to $26 billion, less than a fifth of its levels in December 2007. That’s narrowed the gap between Citi and the home-grown SBI, which sports a market cap of about $15 billion today.

Aluminium giant Alcoa is now worth one-sixth of its market value 10 months ago, at $5.5 billion. That’s just three times the market value of domestic aluminium major Hindalco (though it is India-listed, Hindalco has a global presence due to its overseas acquisitions).

While US-listed retailing and consumer giants such as Wal-Mart and P&G have fared much better in the recent meltdown, tech and telecom companies have seen their market values pruned by half. But they still continue to dwarf Indian companies in a similar business.

Even after the decline in stock prices, IBM and AT&T are valued at six-seven times their Indian counterparts Infosys and Bharti Airtel, in market cap terms.

Better off still

On an overall reckoning though, US stocks have fared much better than Indian ones, in terms of the damage to investor wealth in 2008. While US stocks have seen their overall market cap shrink by 50 per cent this year, the Indian markets have lost over 70 per cent in value.

Bad news on Citi side may hit TCS too

22 Nov 2008, 0143 hrs IST, Ranjit Shinde & Jessica Mehroin Irani, ET Bureau

MUMBAI: TCS, the country’s biggest IT exporter, may see trouble ahead if one of its biggest clients Citigroup sells its business, as cited by media reports.

This could also put a question mark on TCS’s decision to acquire Citi’s subsidiary Citigroup Global Services (CGSL) last month along with a long-term contract of assured revenue of $2.5 billion from Citigroup.

TCS had acquired CGSL, a captive BPO subsidiary of Citigroup, in the second week of October for $505 million. The Indian firm’s management had cited that the deal would help the company to be the financial giant’s top IT vendor.
However, the talks of Citigroup’s possible sellout would steal the colour off this deal on several counts.

CGSL is a captive outsourcing unit, with Citigroup as the only client. If Citigroup’s businesses are sold in parts to several suitors, TCS may find it difficult to retain the current business volume of CGSL, as the new owners would rethink about existing outsourcing arrangements of Citigroup.

While the cash transaction has not been completed, sources said this would allow TCS to terminate the deal, if needed. But TCS denied this.

“The transaction, including the payment to Citigroup, will be completed once the various regulatory approvals have been obtained as per the terms of the agreement,” said a TCS spokesperson. Also, the company is not planning to renegotiate or cancel the deal and is in touch with Citigroup on a constant basis, said the spokesperson in an email reply to ET.

Another point of concern is that if Citi’s business splits, TCS may find it difficult to ensure the fulfilment of the agreement, wherein Citi would give assured revenue to TCS over the next nine-and-a-half years.

Though TCS had acknowledged the possible risks during the media interaction and mentioned that it had taken due care to ensure the deal fulfilment, details on the same were not available. “Our agreement with Citigroup adequately addresses these concerns,” said the spokesperson.

Analysts feel that the news of Citi’s possible sellout may have substantial bearing on TCS’s future growth in the banking, financial services and insurance (BFSI) space. “There is an incremental risk to TCS, as additional business which was supposed to come due to CGSL acquisition may get hampered,” said Viju George, IT analyst, Edelweiss Capital.

He also cited that the possibility might aggravate the situation for TCS given that General Electric (GE), its other top client, is also facing crisis. Citi and GE together contribute nearly 10% to the total revenue of TCS.
Mr George also expressed the need for re-rating the TCS stock given the latest development.

“We need to evaluate the situation as outsourcing calls will be affected due to this development,” he said. Some analysts, however, feel that the impact of the possible sale by Citi on TCS’s bottomline would be limited. “TCS has been a profit-making company. It has a strong business model. Given this, I do not see any major shakeout for the company under the current circumstances,” said SBI Cap Securites research head Anil Advani.

Meltdown impact: 'It was over in five minutes'

Thu, Nov 20 10:33 AM

Sandeep Jadhav, a 27-year-old professional in India's outsourcing industry, had only seen the good times. He worked hard as a support technician in the local subsidiary of an American software company and took home an annual salary of about Rs 5 lakh.

He frequently bought expensive sarees for his wife, toys for his eight-month-old son and cricket gear for himself, maxing out on his two credit cards. In December, he planned to take a home loan and buy an apartment in the Kanakapura suburbs of Bangalore. Last week on Tuesday, Jadhav was called in by the vice-president of his company, handed a month's salary and sacked on the spot.

"I signed the letter, took my cheque and walked out without speaking a single word. It was all over in five minutes," said Jadhav, reliving the moment. The vice-president told him that he was being terminated due to "bad market conditions".

A nightmare called the "pink slip", familiar to most Indian workers as something that happens only in the West, has arrived in Bangalore. In this city, one of the world's hottest outsourcing centres, companies have begun laying off employees and putting a freeze on recruitment. Even campus hiring, a process by which most fresh recruits break into the industry, is at a low. Bangalore is hurting.

Jadhav said he never expected the job situation in the software industry to come to this. In the past years in Bangalore, professionals like Jadhav - personable, articulate and with good spoken English - have been besieged by jobs. While the outsourcing industry has grown at averages of 30 to 35 per cent in recent years, the boom has cascaded into thousands of new jobs for college graduates with sound technical and communication skills.

To be sure, workers took advantage of the explosion by hopping companies, demanding and getting handsome pay jumps. Jadhav has worked in the past for the business process outsourcing firm FirstRing and Dell Financial Services.

But the recent, serial bust-ups in Wall Street and a recessionary US economy has badly hit Indian outsourcing firms. With American companies - their biggest customers - facing an economic dip, outsourcing companies are cutting back and, in turn, choking the job market.

"The scene is really bad and I now realise what my brothers in the United States must be going through," says Jadhav. Outsourcing to low-cost countries like India has been a controversial cost-saving measure adopted by Western companies, and has been the source of much heart-burn amongst workers because of the lay-offs. During the recent US election campaign, president-elect Barack Obama declared himself against the practice.

None of this makes any sense to Jadhav's father, an official with a government-owned bank, who reacted, "I cannot believe this can happen". Jadhav says his father has worked for the bank for 29 years. He expects to continue working there for the next four before retiring.

Despite being pink-slipped, Jadhav himself holds no grudges against his employer of one-and-half years, Dulles, Virigina-based Everest Software, which makes products for small and medium businesses. "If Yahoo, IBM and Microsoft , all big companies with huge cash reserves can lay off, why not smaller companies which lead a month-to-month existence?" asks Jadhav pragmatically.

In the last few weeks, most of his colleagues in the company have been fired, too. "I was one of the last to be shown the door because I was one of the better performers," he says.

The slowdown in India's outsourcing industry, the mainstay of Bangalore's economy, is showing up in unexpected ways. The city's restaurants and drinking lounges are reporting a 30 to 50 per cent dip in revenues. A publicly-listed real estate firm has slashed prices of apartments. Others have introduced low-end options. Rush-hour commuters are even talking of de-clogging in the roads during peak times as outsourcing workers prefer taking the company bus or riding a two-wheeler to driving their cars.

In the last week, Jadhav has been frantically surfing the internet and scouring the newspapers in search of a job. He has dispatched his resume to a dozen companies unsolicited. He has fired it off to several placement consultants. He has attended three interviews so far but he has had no luck.

Jadhav may not yet have a job offer but he has a plan. "At the next interview, I am going to say to the company, give me a job, don't give me a salary. Pay me only after I prove myself. I'm ready to go to that level."

Jadhav's wife Debadrita quit her job as a content editor at Yahoo when she became pregnant last year. The couple now has an eight-month old son. Jadhav has crossed the overdraft limit on his two credit cards and has run himself into a Rs-70,000 credit card debt. As he describes, "I am quite a spendthrift". If he does not land a job in the next one month, Jadhav cannot pay his credit card dues and the card company will "come knocking to my door."

Jadhav's credit card debt has not found favour with his father whom he describes as his opposite because he abhors loans. "If my father has ten rupees in his pocket, he might consider spending one rupee. But I will spend two rupees if I have one rupee in my pocket," he describes. Jadhav concedes he will have to change his squandering habits for the sake of his wife and son. His wife might soon start job scouting too.

It has only been a week since he has lost his job and Jadhav says he can manage for the next couple of weeks on his last pay cheque. If he does not find himself work within a month, Jadhav says he will go to his dad and say "zindabad" to his bank. He says how he expects his father to respond: "He will call me shameless!"

Can humans and aliens co-exist in another planet?

There is good news for scientists looking for a habitable planet to accommodate Earth's burgeoning population. According to a report in www.newscientist.com, many planets dismissed by astronomers as inhospitable may be reconsidered now as scientists realise that the pre-conditions for the existence of life may vary from planet to planet.

In a case of fact being stranger than fiction, scientists have discovered that water and life might exist in planets hitherto considered inhabitable. This one again throws open the age-old debate of whether aliens actually exist in the millions of planets in the universe, and if humans will be able to co-exist with them in conditions different from Earth.

Topping the wish-list of space scientists across the globe is the search for a planet that supports life, which has been going on for years.

Scientists have traditionally been looking for a plant in the 'Goldilocks zone' -- a plant at just the right distance from the sun, so that surface water remains liquid rather than being frozen solid or vapourising into gas, states the report.

But new findings have revealed that various other factors contribute in making a planet habitable. These include a planet's mass, atmosphere, composition and the way it orbits its nearest star, says the report. All or most of these factors together can keep surface water liquid, which gives rise to the speculation that there might be other forms of life out there in planets where the existence of life was not considered possible.

The findings have also forced scientists to consider the possibility of the existence of extraordinary forms of life in otherwise unlivable conditions. Independence Day-type aliens, swimming around in lakes of liquid chemicals in a frozen planet, may not be such a far-fetched scenario after all, scientists admit reluctantly in the report.

Hyderabad 'terror accused' reveal tales of torture, humiliation

November 18, 2008 17:23 IST

The details of the torture and humiliation endured by the 21 Muslim youths, who were detained after the twin blasts in Hyderabad last year, are finally coming out of the closet.

These youths had remained tight-lipped about the inhuman treatment they suffered since the police allegedly threatened to kill them by staging encounters, if they confided in anybody.

Terror in Hyderabad

The youths finally garnered the courage to speak out about their ordeal after a local court acquitted them on all charges and the state government admitted that the youths, many of them the sole bread earners of their families, had been wrongfully detained.

The victims, who narrated their horrific tales to rediff.com, included auto drivers, an embroidery worker, salesmen and a welder. But their stories have striking similarities -- they were all picked up within days of the blasts, illegally detained in secret places and subjected to horrific torture.

'Missing' Hyderabad youth in police custody

Mohammed Abdul Wajid, an embroidery worker from the old city, was arrested on August 27 by plain clothed policemen.

"They blind folded me and covered with me a burqa. After a three-hour long journey out of Hyderabad, they took me to an unknown place. After we reached a building, the policemen started questioning me about the blasts, saying I had planted the bombs and I should tell them who my accomplices were. When I told them that I have no idea what they were talking about, they started torturing me," reveals Wajid.

Hyderabad blasts: Muslims say they are targetted

The torture, which included regular beatings and electric shocks, continued for ten days. Javed was finally produced in court and remanded to judicial custody.

Mohammed Abdul Kareem, an auto driver, also suffered a similar fate when he was arrested by the police and subjected to torture. "The policemen kept telling me that they knew I was involved in the blast. They wanted to know from where I had procured the bombs. I told them that I had never seen a bomb in my life, but this angered them further and they started torturing me."

A year on, Hyderabad blast investigation flounders

Kareem alleged that the policemen often taunted him about his religion. He was also illegally detained for ten days, taken to four different secret locations and tortured in each of them.

Mohammed Mutafa Ali, salesman at a mobile shop, was tortured for four days. He was remanded to judicial custody and remained imprisoned for five months, till the Hyderabad High Court granted him bail.

In Hyderabad, terror accused get a second chance

"Every time the police opposed our bail, claiming that we were involved in terrorist cases. But there was no such charge against us. The police had booked us in a fictitious case of criminal conspiracy," he said.

Abdul Quader, another auto driver, was tortured and verbally abused about his religion.

These youths, all of them from poor families, could provide the surety for bail only after local Member of Parliament Asaduddin Owaisi provided them Rs 50,000 each.

A city torn by terror

They received further financial assistance from local legislator Akbaruddin Owaisi, who gave them Rs 50,000 each to start their own businesses, as nobody was willing to employ these 'terror suspects.'

"Even a murderer or a rapist gets some respect from the society, but we did not even get any sympathy. Wherever we went to look for a job, we were turned away. Even our relatives refused to talk to us. Our lives have been completely destroyed by the false allegations of the police and the propaganda by the media," said Abdul Kareem.

AP: Cops guilty of torturing Muslim youths go scot-free

The only thing that these youths are seeking now is a fresh beginning. They have approached the state Minorities Financial Corporation for margin money under the self-employment scheme. The corporation has agreed to provide them Rs 30,000 and the Indian Bank [Get Quote] is giving them Rs 80,000 each to start their own businesses.

Meanwhile, state Minority Welfare Minister Mohammed Ali Shabbir has announced a compensation of Rs 30,000 for these youths, after the state government finally admitted that they had been indiscriminately detained and tortured.

"The minister's statement is wrong," said Abdul Kareem. "We have not asked for any compensation from the government because money can't compensate for our sufferings."

Mustafa Ali says that if the government actually wants to do something for the victims, it should punish the police responsible for victimising and torturing them. "Then we will feel that justice has been done," he said.

But the government has refused to take any action against the guilty policemen. Shabbir maintains that the policemen were only doing their duty and investigating the blasts cases.

Wronged by the state and turned away by society, these youths have now filed a case against the government, demanding Rs 20 lakh compensation each.

Australia may be nearing recession, index shows, AS

Wed, Nov 19 09:33 AM

SYDNEY, Australia (AP) _ The outlook for Australia's economy is its weakest in 20 years, raising the risk of a recession in 2009, according to an index of economic trends. The annualized growth rate of the leading index, compiled by Westpac Banking Corp.

and the Melbourne Institute, fell to 1.1 percent in September from 3.5 percent in August. The monthly index measures the likely pace of growth three to nine months into the future.

"This is a very disturbing fall in the growth rate of the leading index," Westpac chief economist Bill Evans said in a statement Wednesday. He said it was the biggest monthly drop since the mid-1980s, and marked two straight months in which the index was below the long-term trend of 3.9 percent.

Evans said the report's outlook for early 2009 was poor, with the possibility of a recession. "The growth rate is signaling a very weak growth outlook through at least the first half of 2009," he said.

"It is consistent with Westpac's view that growth in the first half of 2009 will be barely positive with a decent risk that the first two quarters of growth in 2009 could be negative." A recession is defined as two straight quarters of contraction.

Evans predicted that Japan, the United States and most of Europe would be in recession through much of 2009. For Australia, Evans said he was confident that China's economic stimulus package would gain traction, commodity markets would recover and confidence would be partly restored.

"Australia's reliance on Asian growth, which has been a huge liability in recent months, should once again become an asset as we move into 2010," Evans said. Earlier this week, the National Association for Business Economics in the United States also projected recessions in some of the world's major economies.

It said the U.S. economy, which shrank at an annual rate of 0.3 percent in the July-September period, would contract at a rate of 2.6 percent in the current October-December quarter. The association also forecast that Japan, Canada, Mexico, Britian and much of Europe would all suffer recessions in the coming months.

Secret of the perfect phone call - 9 mins 36 secs

19 Nov, 2008, 1738 hrs IST, PTI

LONDON: Want to know what's the secret of a perfect phone call? Well, nine minutes and 36 seconds, says a new study.

Researchers in Britain have found that an ideal phone conversation should last nine minutes and 36 seconds only, and consist of chat about family news, current affairs, personal problems and the weather.

They have based their conclusion after analysing what more than 2,000 people liked and disliked about talking on the phone, 'The Daily Telegraph' reported.

In fact, they found that, during the perfect call, three minutes should be spent catching up with news about family and friends, one minute on personal problems, another minute on work or school, 42 seconds on current affairs and 24 seconds on the weather.

Chatting about the opposite sex should last 24 seconds, 12 seconds should be spent on celebrity gossip, one minute and 42 seconds on laughing, 12 seconds on silence and a minute on other general topics, the study found.

The research, carried out by the Post Office in Britain, also showed that one in five spent most time on the phone to their mother and only three per cent named their father as the person they spent most time talking to.

Hugh Stacey, the Head of Telephony at the Post Office, said: "This research shows us what people really want from a chat on the phone. People obviously value news about their loved ones, with news about family and friends topping charts.

"It was perhaps surprising that celebrity gossip only occupied 12 per cent of the perfect telephone call and was outstripped by current affairs and even the weather. The biggest surprise is that it seems silence is golden -- with 12 sec of every call set aside for a little quiet contemplation."

Cognizant's Impressive Financials

Cognizant Technology Solutions (CTSH) has some of the most impressive financials of any stock you’re likely to see. Recently, the company’s earnings growth rate has dropped from about 50% a year, to just 19% for the last earnings report (Call Transcript). The stock, however, has plunged by over 60% since early 2007.

Here’s a chart showing the stock price (blue line, left scale) and the earnings-per-share (gold line, right scale). The two axes are scaled at a ratio of 50-to-1 which means that when the lines cross, the P/E ratio is 50. Using 50 is obviously a very high multiple. But as you can see, that’s what the stock was following for a long time.

The stock is currently going for less than 10 times next year's earnings. Here’s what I wrote about Cognizant two years ago:

One of the more fascinating companies in the world today is Cognizant Technology Solutions (CTSH). The company, along with Wipro and Inforsys, is one of the foremost names associated with IT outsourcing, particularly to India.While Cognizant is officially based in lovely Teaneck, NJ, its heart truly lies in the subcontinent. The company currently has over two dozen development centers in India.

The growth in this business is simply astounding. The IT/outsourcing sector of the Indian economy is expected to grow from $17.2 billion in 2004, to $50 billion by 2009. For any company looking to cut costs and have someone else handle their IT problems, Cognizant is great place to go. Half of their business is clients in the financial services sector. In fact, JP MorganChase, one of the scions of Wall Street, is a major client. Another 20% of Cognizant’s business comes from health care companies like UnitedHealth.

Cognizant was spun off from Dun & Bradstreet a few years ago and it hasn’t looked back since. As someone who pours over lots of financial statements, I can tell you that Cognizant’s results are extremely impressive. The company has consistently been able to grow its earnings over 50% a year. That’s no easy trick. Also, the company has a solid balance sheet and its operating margins are often around 20%.

For Q4, the company expects non-GAAP earnings of 43 cents a share. That would be a growth of rate of 18%, and the fifth straight quarter of slowing growth.

For number geeks, here's a spreadsheet with CTSH's financials.

Gartner places Satyam in leader category

BS Reporter / Mumbai November 18, 2008, 12:39 IST

Hydrbadbased IT major Satyam Computers Services Ltd has been placed in Leaders quadrant by the leading IT research and advisory firm Gartner in its North America Offshore Services Study.

Gartner evaluated 21 orgnisations in its survey on attributes such as overall viability, market responsiveness, track record and consumer experience and placed it in Leaders position in its Magic Quadrant, informs press release issued by Satyam.

Satyam leverages its application factories and intimate knowledge of customer applications and business to deliver transformational benefits to its client, said Ravi Bommakanti, head of company's application development and maintenance services (ADMS).

It is easy to fire 94 per cent workers in India

Wed, Nov 19 02:25 AM

A large unorganised sector and weak labour contracts make it easier for company managements to lay off employees in India than advanced economies, experts said on Tuesday. However, entrenched employees in the organised sector are well protected by law.

"In India, 94 percent employees are in the unorganised sector. It means they are on contract basis and not on regular payrolls of employers," C.S. Venkata Ratnam, Secretary of the Indian Industrial Relations Association, a professional body, told a seminar on recession and industrial relations organised by the International Management Institute (IMI).

He said unclear policies also helped employers. "In the absence of any firm hiring policy by employers, firing of employees will get unnoticed, making it very convenient for them to fire," Ratnam said.

Seventeen years after kick-starting pro-market reforms, the country's labour laws are largely unchanged from the previous decades but India is groping for a new policy regime as it embraces a globalised economy and welcomes multinationals. Indian workers are increasingly affected by layoffs in multionationals, many of which have growing operations in India.

These include the likes of Citibank which on Monday announced plans to cut 53,000 jobs worldwide as it tries to slash costs amid mounting losses. Though Citi says there is no major impact expected in India, industry is trying to face new realities.

Temporary staffers or "temps" have been the worst hit. Experts say there are more than 3,00,000 "temporary staff" employed in the organised industry in India performing tasks ranging between specialised engineering jobs on factory floors of major manufacturing companies to semi and unskilled jobs in office premises.

Close to 8 crore persons are working as temps in the unorganised sector. "The legal process on firing in India is not very clear", E.M.Rao of the Xavier's Labour Research Institute (XLRI), Jamshedpur, said.

Demanding reforms in labour laws, he said "Chapter V (B) relating to informing employees before prior lay off should be repealed". He also said major insurance companies should come forward with a new scheme of "job insurance" in case of sudden lay offs.

SBI to hire 20,000 people

New Delhi: Amid global banks adopting cost-cutting measures by handing out pink slips, the country's largest lender State Bank of India (SBI) is going against the tide with its plans to recruit about 20,000 people in the current fiscal.

Talking to mediapersons in New Delhi on Thursday, SBI Chairman OP Bhatt said the bank will employ 20,000 people in the current financial year as it is set to open more branches across various parts of the country.

The state-run bank which posted 40 per cent higher profit in the second quarter ending September 30 has slashed the prime lending rate (PLR) by 75 basis points (bps) to 13 per cent with effect from November 10 and will reduce the deposit rates by 50 bps which will be effective from December 1.

Mr Bhatt apprised that even in this tough time, the bank's rights issue was over subscribed.

In the BSE ranking, the Bank has moved from 14th to 5th place and has secured 380th place in the Fortune 500 companies.

Life in 2050, and a few (un)answered questions

Sampat Mukherjee

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If we are to make the best use of the tools economics offers, we ought to think about what we are striving to achieve. The decisions we make now will affect our pattern of living. SAMPAT MUKHERJEE puts together some questions about life in 2050 that are worth pondering about.

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Economics is a social science and, therefore, an inexact one. It can just help us to understand and improve an imperfect world. In the final diagnosis, it appears that it is just a set of tools. If we are to make the best use of these tools, we ought to think about what we are striving to achieve.

We must first define the ‘good life’ before economics can take us there. Here are some unanswered questions about life in 2050 worth pondering about, because the decisions that we make now will affect our future — our pattern of living.

Productivity growth

How many minutes of work will a loaf of bread cost?

It is the productivity question. Almost every aspect of economic life is a means toward this end (and other ends, too). If productivity grows at 1 per cent a year over the next half century, our standard of living will be 50-60 per cent higher by 2050. If productivity grows at 2 per cent a year, then our standard of living will nearly triple in the same time frame — assuming we continue to work hard, save and invest more and take risk.

Economic theory predicts that as our wages go up, we will work longer hours — up to a point, and then we will begin to work less.

Productivity growth gives us choices. We can continue to work the same number of hours while producing more. Or we can produce the same amount by working less. Or we can strike some balance. Let us expect, with cautious optimism, that Indians are going to make up their minds one day and decide how much they will work.

Bridging the inequality

How many people will be active?

Even if the economies of the West are booming, we find a striking dichotomy between the rich and poor.

What are we willing to promise the most disadvantaged? In market economies of the developed world there is a comprehensive social security system (called safety net). General benefits are mandated by law; healthcare is a birth right. This leads to a more compassionate society in more ways than one. Poverty rates and increase in inequality are low.

It also leads to higher unemployment and a slower rate of innovation and job creation. Workers, bundled with several mandatory benefits, are expensive. Since employees cannot be fired easily and quickly, firms are slow to hire them in the first place.

In this context we may compare the American system with that of the European. The American system is a richer, more dynamic, more entrepreneurial economy — and harsher and more unequal. It is conducive to creating a big pie in which the winners get huge slices. The European system is better at guaranteeing at least some pie for everybody. Capitalism comes in different flavours. Which one will be chosen?

Socio-economic issues

Will we use the market in imaginative ways to solve socio-economic problems?

The simplest and perhaps most effective way to get something done is to give the persons involved a reason to want it done. We all nod, as if this were the most obvious point in the world — and then go out and design policies that do just the opposite.

We have a public education system that does not reward teachers and principals when their students do well (or penalise them when their students perform badly). We assess more of our taxes on productive activity, like work, savings, and investment, when we might raise revenue and conserve resources with more “green taxes”.

If economic agents get the right type of incentives, then markets can be used to solve all kinds of problems. In truth, markets do not solve social problems on their own (or else there would be no social problems). But if we design solutions with the proper incentives, we feel a lot more like smooth sailing in a rough sea.

Role of government

Are governments redundant in an age of discontinuity?

Many countries have abandoned the central planning system in the late 1990s and have embraced the market system. Mixed economies have introduced public sector reforms, which led to a fall in the size of the government. But all these do not imply that the government has become less important over the years. Government has as much to do as ever. What keeps world leaders awake at night: Global warming? Drugs? Terrorism? Trade war? Financial crises? None of these problems can be addressed properly without government; indeed, none can be managed successfully without co-operation among governments.

Business cycles

Do we really have monetary policy figured out?

The Japanese economy, one of the largest and most productive in the world, has been stagnant for more than a decade. The Nikkei Index, Japan’s equivalent of the S&P 500, is no higher today than it was in the late 1990s. This should give us pause.

We have not conquered the business cycle (the economic ebb and flow that leads to periodic recessions).

At best, we have managed to tame it. In the 50 years before the Great Depression, the US economy was in recession roughly half the time. Since then, it has been in recession less than 20 per cent of the time. We have gained on better understanding of both fiscal and monetary policy. Consequently, the economic ride has been smoother.

Still there is plenty to worry about.

The ‘dark’ continent?

In fifty years, will ‘African tigers’ refer to wildlife or to development success stories?

There is no silver bullet for economic development. Will the world be significantly less poor in 2050? The answer is not obvious. We can imagine an East Asian scenario, where countries transform themselves in a matter of decades. Or we can imagine a sub-Saharan African scenario, where countries stumble from decade to decade without any significant economic growth at all. The first scenario will lift billions of people out of poverty and misery; the second one will not.

When we raise the question as to whether poor countries will still be poor a half-century from now, the question seems distant and abstract.

But if we provide a more precise specification and raise questions about things that will distinguish poor countries from their rich counterparts, then global poverty seems more traceable. Will governments in developing countries create and sustain the kinds of institutions that support a market economy?

Will they promote export-oriented industries that will enable them to break out of the trap of subsistence agriculture — and will the advanced countries open their huge markets to those products?

Will the rich countries use their technology and resources to fight the diseases that are ravaging the developing world, especially AIDS?

Will the family of a baby girl born tomorrow in rural India have an incentive to invest in her human capital so that Amartya Sen’s ‘missing women hypothesis’ becomes a thing of the past?

(The author is Senior Professor of Economics, St Xavier’s College, Kolkata. blfeedback@thehindu.co.in)

Mid-tier IT firms hire ‘average’ numbers

Demand for temporary staff up.

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Caution is the word

Lateral hiring would be on the lower side vis-À-vis last year: Patni

We have long-term projects and we need manpower: Tech Mahindra

The utilisation rate is already quite high; the scope for reducing hiring is limited: MindTree

Not looking to hire technical people till April next: Ramco Systems

Because of the general slowdown, hiring will come down: Mastek

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Shamik Paul
Adith Charlie

Bangalore/Mumbai, Nov.17 The uncertainty due to the economic meltdown in the US, which is the largest market for the Indian IT industry, may not have prompted mid-tier Indian IT companies to revise hiring plans, but most showed no increase in hiring compared with the previous fiscal, while some said they would hire less than last year.

More freshers

Patni Computer Systems Ltd, which plans to hire about 2,000 freshers by the end of the fiscal as against 2,700 in the previous, said lateral hiring would also be on the lower side vis-À-vis last year, when it added 1,300 laterals.

The company did not put a number to its lateral hiring plans as it would depend on the demand environment.

“Lateral hiring will continue but we will be hiring more freshers. We are comfortable with our lateral numbers but feel the need to make more inductions at the base of the pyramid. This is also a small function of the current economic and demand environment,” said Mr Rajesh Padmanabhan, Executive Vice-President and Global Head of Human Resources, Patni.

Tech Mahindra Ltd, which has already offered 1,500 jobs at campus hirings, said for fiscal 2009, the number would be between 2,000 and 3,000.

This has been the average for the company over the last two-three years, although it is a big reduction compared with the 5,000 the company hired last fiscal.

“In the last year we needed more people and therefore we hired 5,000. For 2009, we have no major reduction plans: we have long-term projects and we need manpower,” said Mr L.K. Bhatia, Vice-President, Resource Management Group, Tech Mahindra.

He said about 500 laterals have been hired in the last two-three months.

High utilisation rate

For MindTree Ltd too, manpower addition for the current fiscal is in line with last year. The company has added about 1,000 people this year, of whom about 70 per cent are freshers.

“Right now we are not looking at dramatic changes. It is more or less aligned to our last year figures, which is between 1,000 and 1,200,” said Mr Puneet Jetli, Head, People Function, MindTree.

Mr Jetli said the utilisation had gone from 65 per cent to about 70 per cent at the end of the second quarter, which has helped the company.

However, because the utilisation rate is already quite high, the scope for reducing hiring by further improving utilisation is limited, he added.

Ramco Systems Ltd said it is not looking to hire any more technical people till about April of next year because its products and solutions have reached a certain level of maturity.

However, it would hire 50 to 80 business consultants who have domain expertise in aviation, logistics, manufacturing and finance, said Mr J.S. Shivakumar, General Manager, Human Resource, Ramco Systems.

Mr R.S. Desikan, Group CFO and Director of Finance, Mastek Ltd, said the company follows the non-linear model where the headcount is not proportionately linked to the targeted revenue figures.

He said, because of the general slowdown hiring will come down, but not in the same proportion as decline in revenues.

This year, about 300 freshers have joined, which is the same as last year. The company would not put anybody on deferred joining. There would also be no dip at all in lateral hiring, he said.

Emerging trend?

The uncertainty may have also pushed the demand for temporary employees. A Mumbai-based temporary staffing firm said the requirement for temporary employees has grown up by almost 15 per cent over the past three months.

Moreover, the turnaround time in finalising temporary employees has become shorter; it just takes around five to seven days now.

Generally, companies show their temporary staffing under marketing expenses and not as HR expenditure, according to the firm.