Layoffs, recession to bring more outsourcing contracts in India
NOIDA, INDIA — Top office developers believe that the country would attract more American outsourcing and property contracts following layoffs and the looming recession in the United States (U.S.).
Aditya Virwani, Chief Operating Officer at Embassy Group, is expecting U.S. firms to transfer to India “in the next two to three quarters” due to its cheaper real estate and talent.
“We believe the next four months will be decision-making and expecting big activity in the second half of the year,” Virwani said.
Niranjan Hiranandani, managing director at Hiranandani Group, also noted that a recession in the US would mean “companies can’t afford costs and have to outsource their operations to countries like India which has cheaper costs.”
Meanwhile, Sanjay Dutt, managing director and CEO at Tata Realty & Infrastructure, emphasized that India has become a “definitive destination“ for outsourcing due to its talent, cost arbitrage, stable political, investment climate, successful COVID-19 management, drive for ease of doing business, and over two decades of profitable businesses.
Regarding the property market, Dutt said that “India will sustain conservatively on an average 30 million square feet net private development for lease absorption till 2030. We will cross 1 billion sq ft if we include self-developed and occupied campuses of Indian IT majors like TCS, Wipro, Infosys, and so on.”
On the other hand, Prashant Thakur, Senior Director & Head of Research at Anarock Property Consultants, countered that India might not see an immediate increase in outsourcing transactions given that most clients are cost-cutting.
