Coronavirus: Fear in Hyderabad IT park, industry on guard

Coronavirus outbreak has rattled business operations leading to changes in work processes. There's uncertainty and fear that if the current situation continues, client meetings will get cancelled, onsite engineers' travel be restricted, deal closures delayed, and all this could reflect in losses in future.

However, several firms, thanks to their precautionary measures are sanguine that it won't have much impact on their businesses and the crisis too shall pass.

Industry body Nasscom (National Association of Software and Services Companies) said in its statement on Thursday (March 5), "Based on discussions with our members, we do not see any immediate business impact, however, we are following developments around this issue closely. The industry has a large footprint of on-shoring centres/offshore and client requirements can be met through such centres, if required. The industry has also put in place Business Continuity plans and has internal taskforces to monitor the situation continuously,"

While, many companies have shut operations and asked employees to work from home, others have put restrictions on non-essential domestic and international travel especially to China, Iran, Italy, Japan, Singapore and South Korea.

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A lot of them are also disinfecting and sanitising office spaces, discouraging staff from conducting physical meetings. For instance, building number 20 in Raheja Mindspace which is a major IT park in Hyderabad has been in the spotlight since Wednesday (March 4) after a suspected coronavirus case was detected in one of the companies operating in the building.

Telangana IT and Industries Secretary Jayesh Ranjan who has been keeping track of all developments in Hyderabad revealed that the test report for this person has come negative from the National Institute of Virology, Pune, where they were sent.

"We in the government have directed the building owners and the facilities management to keep the building extremely sanitised, especially all the common areas and the lifts and also recommended personal safety precautions to people," Ranjan pointed out to Business Today.

Following this, there is apparently a sense of relief among the companies in office complex building and they will hopefully resume normal operations soon. The building houses around nine companies' offices including Cognizant, Facebook India Online Services, OMICS International DSM Share Services and others.

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Cognizant which operates out of the building had on Wednesday asked its employees to work from home but the IT company now intends to resume operations from Friday (March 6).

However, the companies have some concerns as well, for instance, there is also the element of billings in cases where companies offer client services that are a mix of onsite and offsite operations or the firms that provide a combination of design and manufacturing to customers with product fabrication in China.

Case in point, BVR Mohan Reddy, founder of Cyient and the former chairman of Nasscom, says, "We have a business through one of our subsidiaries in Belgium wherein we design the chip for a very reputed customer in the medical electronics space. The chips are fabricated in China, from where they are directly shipped to the customer, who pays for the chips but, whenever the client receives the chips, it also sends out a cheque to us for royalty because the design was done by us. Now, since the chip movement from China is impacted, the royalty payment is also not happening."

However, at an overall level, he says, "the uncertainty is the biggest worry, especially in terms of deal closures, people and material movement but we are hoping everything will be resolved in the course of the next few weeks otherwise, it will start impacting businesses."

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