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As India's economy begins to recover from the impact of the global
financial crisis, companies have again started recruiting staff and
handing out pay raises. The mood is in sharp contrast to a year ago,
when the global economic downturn put an abrupt end to a five-year
economic boom in the country.
Mukherjee is a post-graduate business management student at one of
India's premier business schools in New Delhi. When she began her
course work this year, she was worried that it might be tough to land a
job when she graduates.
She had reason to be concerned. Nearly
half the class of 2009 did not find suitable jobs when they graduated
in April. That was not surprising. Just as in many other countries,
Indian companies had stopped recruiting staff as they coped with the
global economic downturn.
But Mukherjee says the mood on college campus is now much more upbeat.
we went there, a lot of our alums [alumni] had not gotten placed. So
we would still see them constantly coming to campus, still taking their
interviews. And, obviously, somewhere we were a little worried as to
what would happen when we get to that point. Now, it's much better.
We already have people coming to campus. There is already a buzz
around. And, now we see things are getting better. So people are much
more relaxed," said Mukherjee.
As India emerges from the global
downturn faster than many countries, companies here have announced
plans to start hiring again. And, as people gear up to celebrate the
country's main festival, Diwali, next week, employers are handing out
pay hikes and bonuses to staff.
Although India was less
affected by the downturn, compared to Western countries, many hard
hit-sectors downsized in the past year. Almost all companies had put
salary raises and bonuses on hold, as profits declined.
But, now, sectors such as finance, insurance, services, information technology and retail are back to hiring.
Malhan, who heads the job consultancy firm Manpower India, says a
recent global survey shows that India's job market is more buoyant than
that of other countries.
"India is on top. The maximum number of
employers who had positive intent to hire is highest in India, in
comparison to any other country. In order of sequence, India is
leading, then would be Brazil, then will be Colombia, then will be
Peru, and then will be China, Australia, and then Singapore," said
The government says the economy is back on
track and is eyeing growth of more than six percent, this fiscal year.
In the last year, it has passed three stimulus packages and cut
interest rates and taxes to boost spending. These measures have helped
bring consumers back to markets and industrial activity has picked up.
economist at the Federation of Indian Chambers of Commerce and
Industry, Anjan Roy, says business confidence is higher than it has
been in the past year.
"Indian industry has turned around and
the slowdown is wearing out. These are the early days, when the
expansion growth triggers are once again operating and we expect this
should go on, provided there is no reversal of these basic policy
parameters," said Roy.
Concerns remain. Businesses are worried
that the government could raise interest rates to check rising
inflation and food prices. A drought in much of the country and
flooding in other parts has hit agricultural growth and will dampen the
rural economy. And, there are fears that any reversal in the tentative
economic recovery being seen in several Western countries could stall
momentum in India.
Economists also warn that the economy may
be improving, but it is unlikely to reach the levels of over eight
percent growth witnessed for four years prior to the global financial
crunch. At that time, Indian industries were turning in huge profits
and rising salaries had brought new affluence to the middle class.
management student Mukherjee says the expectations of her class are
more modest than those of students who graduated during the economic
boom India witnessed between 2004 and 2008.
salaries and our remuneration will not be as good as it was three years
back or two years back, but I think we should be okay this year," said
India is Asia's third-largest economy.
International institutions, such as the World Bank and International
Monetary Fund, have said that countries like India and China will help
pull the global economy out of the worst recession seen in recent