Insider view: Has the IT industry recovered?

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'Cautious optimism' and 'worst may be over' are words usually coined together by the industry and media alike to describe the IT industry's outlook. Recently, when brokerages were in the process of upgrading the sector due to a perceived improvement in business fundamentals, a cautious Infosys warned against 'irrational exuberance'.

Even as business picks up, hiring continues to remain subdued . What then is the actual outlook for the sector? Phaneesh Murthy of iGate, while shedding light on business for the company and in general for the sector said he was seeing an up-tick in orders. "Everybody is seeing signs of order pickups," he said.

"Most IT companies have grown in the second and third calendar quarters. We have most of the results now and we [iGate] grew by almost 5% quarter-on-quarter. In both these quarters, most of the industry has grown between 2% and 5%," Murthy said. The business process outsourcing (BPO) industry was also seeing work coming into India in a bag way, he added.

The banks, financial services and insurance (BFSI) sector in the west had undergone re-structuring, Murthy said, and that orders from that sector too would pick up significantly. The BFSI sector in developed nations, which took the most severe hit in the global financial crisis, forms a major chunk of clients for Indian IT companies.

"In my sense, 2010 IT budgets [of companies abroad] would go up by 2-4% compared to 2009," Murthy said.