Appreciation of the Rupee Forces IT & BPO Firms to Have a Re-Look at their HR Polices*



Case Code : CLHR027
Publication date : 2009
Subject : HROB
Industry : -
Length : 03 Pages
Price : Rs. 100

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Key words:

Information Technology (IT), Business Process Outsourcing (BPO), Rupee Rise, HR, Infosys, TCS, Wipro, recruitment, wage bill


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The IT & BPO sectors in India have been hit hard with the rise of Indian rupee against the dollar. This has prompted the companies in these sectors to have a re-look at their HR policies and practices and to utilize the resources optimally.


On November 1, 2007, rupee value touched a 9 year high against the US Dollar (US$1 = Rs. 39.22/24). The Indian rupee appreciated almost 12 percent against the US Dollar between April and November 2007, with India's economy growing at a healthy rate of 8.6 percent.

While it was anticipated that the consistent rise of the rupee against the dollar would bring delight to all the sectors of the economy, but the actual scenario was vastly different. The Information Technology (IT) and Business Process Outsourcing (BPO) companies in India felt the pinch as 70 percent of the payment by the clients was done in dollars resulting in losses for companies in this sector.

IT & BPO were sunshine sectors in India, contributing some 5.2 percent to India's Gross Domestic Product (GDP) , and it was estimated that between 20 and 25 percent of India's GDP expansion in the next three to four years would come from the IT industry in India. But the rise in rupee value was increasingly proving to be a disadvantage for this sector...

Cases on related topics

1. Some HR Dilemmas in Information Technology and Business Process Outsourcing Firms

2. The Appreciation of the Rupee