COVID-19 Hits Indian Outsourcing: Financial Times

As the COVID-19 spreads in India, Prime Minister Narendra Modi announced a 21-day nationwide shutdown with a strict curfews and limitations on running non-essential businesses. The shutdown poses disruptions for one of India’s pillar industries – IT outsourcing serves many major multinational companies, such as Citibank and Pfizer. With more than 900 confirmed cases at outsourcing firms, IT companies have asked hundreds of thousands of employees to work from home and upgrade networks for remote work from homes. In addition, IT firms lobbied the government to allow some workers to perform critical functions at workplaces. India’s IT outsourcing industry hires about 4 million workers and generates annual revenue of US$180 billion. The shutdown in India and other outsourcing countries could encourage major customers in Europe and the United States to reduce reliance on India’s firms and manage their own internal systems. IT companies and staff try to adapt, and the industry association also suggests relying on force majeure clauses in contracts for confronting the challenge. – YaleGlobal