Rising IT budgets of sectors like media, publishing and entertainment are fuelling growth of the information technology industry, according to a top official of software development company HCL Technologies.
"Basic industries that are undergoing transformation are the sectors where we are seeing increasing IT spend and that is fuelling growth. Media, publishing and entertainment is undergoing a transformation. So is it with healthcare and insurance," HCL Technologies Chief Executive Officer Vineet Nayar told reporters on the sidelines of a Nasscom summit here last evening.
He said Remote Infrastructure Management (RIM) will continue to grow predominantly because it is a young industry with a greater head room for growth.
Banking, financial services and insurance sectors in the US were witnessing a shift as companies are preparing themselves to gain a larger share of new consumers, Nayar said.
"The BFSI segment in the US is getting ready for dealing with the new consumer. Therefore, they are making investments not just in mergers and acquisitions and integration but developing new platforms that are more web-based, providing more agile services to the consumer, more products, combining insurance and banking products and capital market products on the portal," Nayar said.
Reacting to the US President Barack Obama's recent statement that it would slash tax-breaks to companies that ship jobs overseas, Nayar said it was justified.
"I think it is a fair argument that every democracy should be concerned about jobs in their respective countries and to a certain degree, job creation and unemployment is a responsibility of the local government. Therefore, rational steps forward is the right thing. You need to be hiring locally," Nayar said.
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Obama last month said his administration would "slash tax-breaks for companies that ship our jobs overseas" and instead "give those tax-breaks to companies that create jobs in the USA", which sent shivers down the IT industry's spine as the US accounts for 60 per cent of India's IT export market.
Nayar said the US and the Europe will take positions that are good in their assessment and Indian software companies will have to reconfigure themselves to align with that to convert them into opportunities.
"There are fundamental changes which are happening in the IT industry, to which HCL has responded very well and we have seen growth during the recession (by hiring locally). In the last four to five quarters, I think we would have increased our total combined headcount in local hiring in the US and the Europe by about 3,000 people," he added.