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The IT industry is facing tough times these days. Looks like the honeymoon period is over & conditions are toughening. I am referring to the appreciating value of Rs, which is brining down the “cost arbitrage” advantage for Indian IT firms. This has been proved by the fall in growth of profits in the first quarter of FY 07 08. To overcome this Indian IT companies should come out with innovative solutions, which are tough to be copied by others. Such solutions only will give these companies a temporary competitive advantage over cos in low cost nations. As an immediate action cos are taking about improving utilization & hedging. Only time will tell how the industry comes out of the problem.
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Developmental issues in Chennai need a special mention. IT industry has spurred unbelievable growth in the last 5 years in Chennai. Moring from 07:30 till 10:30 roads are choked with the various IT company buses. Especially in OMR the condition is very bad. This is because of the road repairing work that is going on. Hopefully with 2008 we would have congestion free OMR !
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