Infosys founder Narayana Murthy believes that tech layoffs in the U.S. could benefit India's domestic IT companies adding that he viewed layoffs as part of a business cycle and was not overly worried about them.
What Happened? Speaking to CNBC, Murthy explained that a downturn in the U.S. market would present a significant opportunity for India, particularly in the IT sector, as it provides better value for money.
In a downturn, India would work even harder to take a larger market share and mitigate job losses, Murthy believes.
Murthy founded Infosys in 1981 with six friends and served as CEO until 2002. Today, many companies choose to outsource software development to India for high-quality IT professionals at a reasonable cost compared to prices in the West, while Infosys, with over $60 billion (₹4,92,050 crore) in value, hires more than 346,000 workers worldwide.
According to Peerbits, custom software development companies can save 20% to 30% in tech spending by outsourcing their needs to India. Murthy believes that U.S. corporations must improve productivity and reduce costs to move forward without relying on other countries.
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Diversifying Production: Murthy during his conversation with CNBC also cited how Apple has been shifting some of its production to India. The Cupertino giant began assembling its flagship iPhone 14 there last year due to Covid outbreak and workers’ protests that disrupted production at the world’s largest iPhone factory in Zhengzhou, China.
Currently, Apple manufactures 5% to 7% of its iPhones in India, which is a significant increase from just 1% in 2021.
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