Brand Bengaluru adversely affected by river dispute

With Section 144 imposed in the city, Infosys, Wipro, HCL Technologies, SAP Labs, GE’s JWFTC, IBM, NTT DATA shut their offices for the day, made arrangements for employees to work remotely, and activated business continuity processes to ensure delivery of projects. Some firms such as VMware and Akamai Technologies were closed for Id. E-commerce companies such as Flipkart and Amazon also said their operations were affected.

Just this month, the city witnessed two other disruptions — the strike by central trade unions on September 2, and the Karnataka bandh of September 9 to protest the Supreme Court’s orders on release of Cauvery waters. A number of IT firms had declared September 10, Saturday, a full working day, while many plan to work on September 17 to make up for the lost working hours.

Apex industry body Assocham claimed that Karnataka, particularly Bengaluru, suffered losses of ₹22,000-25,000 crore from damage to public infrastructure and interruptions in road/rail/air transport. With the city being home to a number of American firms, including Accenture, Microsoft, Walmart, LinkedIn and Target, the US Consulate-General in Chennai had sent out a security advisory asking American nationals to avoid visiting protest-prone areas.

However, over a dozen IT firms that BusinessLine spoke to confirmed that Tuesday’s shutdown would have no business impact, as business continuity plans kicked in with mirror sites in other locations taking on all the work that could not be done out of Bengaluru. KS Viswanathan, Vice-President, Industry Initiatives, Nasscom, said: “The IT industry has reached a stage of maturity that allows it to cope with such situations without incurring any loss.”

Even as the city limped back to normal, Brand Bengaluru had taken a beating. “The long term viability of brand Bengaluru as an outsourcing destination is under question, as customers question the wisdom of outsourcing to Bengaluru,” said Sanchit Vir Gogia, Chief Analyst, Greyhound Research. He said customers in the US and Canada feel the city’s inability to deal with basic issues such as traffic has been compounded by the festering Cauvery dispute.

This can push them to look for alternative locations in the country or even outside. Another fallout, according to Gogia is that the cost of doing business for Indian IT firms will rise as they will have to consider setting up offices elsewhere, which will erode margins.

Credits The Hindu Business Line

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