Ukraine crisis may shift some IT work from Poland, Romania, Hungary and Russia to India and other Southeast Asian countries

The exit of tech companies like Accenture and IBM from Russia and disruptions in the operations of tech delivery centres in Ukraine is likely to divert more work to India and other Southeast Asian countries. It is also likely to bring more business to Indian IT services giants as global tech firms with large presence in Ukraine now stare at a period of uncertainly.

Indian IT services majors have a fairly small base in Ukraine, as also neighbouring countries like Poland, Romania and Hungary. But global IT and engineering services firms such as Epam, GlobalLogic and SoftServe have large delivery centres in Ukraine and are now evaluating other markets for business continuity, especially India. US-headquartered Epam, which has over 12,500 employees in Ukraine, has already withdrawn its first quarter guidance and 2022 financial outlook due to the uncertainties.

“The company is proactively working to relocate its employees to lower risk location in Ukraine and neighboring countries. The company is executing business continuity plans and accelerating hiring across multiple locations in Central and Eastern Epam said in a statement.

Peter Bendor-Samuel, founder of outsourcing research firm Everest Group, said the environment presents a great opportunity for Indian firms as between the service providers and global business services (GBS)/captives, “there is likely in excess of a 100,000 FTEs (full time equivalents/employees) which will be affected and be taken out of the global workforce due to the war and sanctions”.

Prashant Shukla, VP in Everest Group, said the situation adds to the already challenged talent environment, especially as the talent pool in these directly impacted geographies has a good element of specialized skills around next-gen tech. Ukrainian software developers are seen to be among the five strongest IT communities globally, given their expertise and high English proficiency.

“Ukraine is one of the top locations for offshore and near-shore third-party services, particularly for engineering and IT skills,” Quess IT Staffing CEO Vijay Sivaram said. Industry executives TOI spoke to said in the medium term, the conflict will bring more Eastern European clients to Indian IT services companies. The top-tier IT services firms TOI wrote to decline to comment, but they said they are closely monitoring the developments in the region.

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