Indian economy will recover earlier than global economy: Azim Premji

BANGALORE - Azim Premji, chairman of IT major Wipro, is optimistic about the revival of the Indian economy earlier than the world economy, saying the country remained largely insulated from the fallout of the financial meltdown and recession in developed countries.

‘I am little more optimistic about the India situation. The reason is we have not been ravaged by the financial crisis like most of the developed world,’ Premji told IANS here Wednesday, on the sidelines of a briefing on the firm’s third quarter results.

Premji, who declined to speak on the Satyam scam, is also betting on the early revival of the domestic economy because of higher kharif and rabi crop production on account of good monsoons.

‘So one can be hopeful of some revival in the Indian economy much earlier than the revival we are going to see in the global economy,’ he said.

In Premji’s assessment, the US will recover faster than Europe, as it faced the crisis about six to nine months earlier.

‘I am also optimistic about the new leadership (of Barack Obama) in America in terms of lifting the sentiment of the people. It is an important aspect vis-à-vis the revival of its economy,’ he said.

With the revival of global economy being prolonged, Wipro plans to focus more on the Indian and Middle East markets during this and next two-three quarters to sustain its growth momentum.

‘We are extremely well-placed in the Indian IT services market given our reach, depth and brand. We had a very strong growth in India in the third quarter. Our Middle East market will continue to do well,’ Premji asserted.

He, however, admitted 2009 would be a tough year given the fragile global economy, a brittle domestic security environment and corporate governance coming under the scanner.

‘Consumer confidence is down significantly and leading indicators suggest that the bottom is not in sight. This will impact every economic activity leading to capital conservation and opex (operational expenditure) reduction,’ Premji noted.

He also projected lower dollar guidance ($1.05 billion) this quarter from the global IT services and products division than that achieved in third quarter ($1.13 billion).

On the outlook for the next fiscal, Premji said though IT budgets for the year were likely to get finalised this quarter, customers would decide quarter-by-quarter.

‘Our customers are not looking for vendors, but for business partners who know the priorities and collaborate with them. Challenging times differentiate great companies from good ones. This is an opportunity that we want to take with both hands,’ Premji said.

But he hastened to add that his company’s partnership with customers was not at the cost of investors. ‘Our focus on operational efficiencies will ensure that our investors are not short-charged in the short or long term.’