Indian outsourcer Wipro is delaying establishing a software development center in Atlanta, Georgia, reflecting the impact of the global economic downturn on the company’s expansion plans.
Wipro said in August last year that it was setting up a center in Atlanta, recruiting skilled talent within the U.S. in order to provide nearshore services to their customer.
A number of Indian outsourcers have set up facilities near to their customers in the U.S. and Europe to deliver services, and also to counter local criticism that Indian outsourcers were moving local jobs offshore. Some of their outsourcing contracts have also included hiring the local staff from the customer.
“We are not shying away from what we plan to do in Atlanta but it is taking more time than expected,” Wipro said in a statement. The company added that as the Atlanta center is a new initiative, it takes more time to get customers’ attention, given the uncertainty in the environment.
Wipro said last year that it planned to employ 500 staff at the Atlanta center by the third year of operation. The company said it would use the training center in Atlanta to provide both technical and soft-skills training to its employees in Georgia, and also planned to sponsor higher education degrees for up to 40 percent of its employees.
The company reported revenue of 64.10 billion rupees (US$1.36 billion at the exchange rate at the end of the quarter) for the quarter ended September 30, up 36 percent over the same period last year. But profits grew only marginally, by 1.3 percent, to 8.22 billion rupees.
Wipro said its outlook is cautious in the near term given the extent of strain on the global economy.
Outsourcing consultancy firm Technology Partners International (TPI) said that although third quarters every year were usually weak for outsourcing contracts, this year the quarter was the weakest in 10 years.