Banks' caution may weigh on growth of IT industry

Better growth for the Big Five of India's IT industry in the next financial year has come under doubt, with some of the largest banks, the biggest customers of homegrown IT firms, putting large tech spending projects on hold.

- Varun Sood

NEW DELHI: The reason: Uncertainty over inflation rates and whether America's recent tariffs on goods from China and Mexico could start a new round of trade war.

After meeting company executives, at least two brokerages—JM Financial Institutional Securities Ltd and Kotak Institutional Equities—last week red-flagged some challenges that could dampen growth for the country's $283 billion IT industry. Optimism also weakened after Capgemini SE guided last month that the French IT services firm will experience no organic growth in the current calendar year.