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The US second largest bank is going to increase its IT outsourcing to India by more than 25 per cent.Despite the US government refusing to hand over economic stimulation money to outfits who do not hire Americans, JP Morgan Chase wants to spend USD400 million on work outsourced to India to streamline its IT operations.
JP Morgan Chase acquired Washington Mutual and Bear Stearns and wants to bring down the cost of integrating different computer systems.
The bank already outsources USD250 to 300 million worth of IT and back-office projects every year to Cognizant, TCS and Accenture. JP Morgan has always been a big fan of outsourcing and when the credit crunch happened had worked out a plan which involved outsourcing to reduce costs.
However, the move is not going to be seen by Washington very favourably. Stimulation packages being given to the banks specify that they must hire US workers.t will prove to be a huge boost for the Indian IT services sector, which has been jarred in the past six months by the global economic recession and by statements from President Obama warning of wide-ranging protectionism. JP Morgan is seen as a Wall Street leader in IT strategy.
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