Fear of war forces IT outsourcers to flee

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By Chris Lee in Melbourne [07-06-2002]

India-Pakistan conflict takes toll on its technology sector
Fear of nuclear war in the Far East is driving IT outsourcers to leave India.
With the threat of a conventional conflict or even a nuclear exchange between India and its volatile neighbour Pakistan over Kashmir, companies such as JP Morgan and Chase Manhattan are considering leaving for calmer pastures.

While only a small number of companies have so far raised doubts about locating their business in India, IT consultant Accenture has voiced its concerns.

"We have changed our view of the geopolitical risks," Accenture partner Greg Carroll told the Sydney Morning Herald. "We have seen very real concern in September last year and in the last three weeks."

With its competitive salaries giving it the edge over other markets - particularly the UK - India has seen a surge in interest in its IT skills from major outside firms.

But analysts have warned that foreign countries' recommendations that their citizens should not visit the region could only damage India's IT sector further.
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