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Even as Obama’s statements ring concern bells in the IT sector in India, a new IT hub is emerging in the country, Gujarat known better for its diamond industry, is making strong inroads in the IT sector and the state is on a recruitment drive.

While cites like Bangalore, Hyderabad, Pune and Chennai, are known to be IT hubs in the country, Gujarat is now emerging as a strong contender. And despite the slowdown ITeS and BPO players in Gujarat are busy recruiting people, despite the glooming scenario in the sector.

Some of the eminent IT players in Gujarat on a recruitment drive are :

* Azure is recruiting between 900 - 3500 IT professionals by July end.

* Aegis has 200 openings and Etech has 200 openings for recruitment.

And helping push these numbers are their strategy to service tier-2 and tier-3 clients
Nirav Shah, President, Gujarat Electronic and Software Industries Association (GESIA) said, “Over the couple of years, IT players from Gujarat have been able to create a good market goodwill and when it comes to relocating services to cost-effective service providers, players and Ahmedabad and Gujarat are on the priority basis, even when we talk of international space, small and medium players from international space are exploring options of cost-effective solution and services providers, for them also Ahmedabad and Gujarat are the favorable destinations, as compared to Bangalore and other IT destinations.”

Though the companies are on a recruiting spree…. Gujarat does not have a talent pool to match the demand. And this may trigger the companies to hire from other IT hubs…

Gurudutt Medtia, director, Etech, Inc. said, “It is also largely the selection of the process like when we talk of Gujarat, process are largely of legal processing in nature or back office or lead generation, which are recession proof in nature and that is the reason, recession really does not make an impact.”

With Obama s saying Yes to Buffalo and No to Bangalore, ITeS/BPO companies in Gujarat do not fear the curse of shifting outsourcing out of India, as they have domestic process on their kitty and that is one of the reasons, they are heavy on the recruitment, despite of global meltdown.

Washington: U.S. President Barack Obama is leaving no stone unturned in his effort to bring the ailing American economy back on track. Keeping his promises, Obama has announced an end to the years of tax incentives to those U.S. firms which create jobs overseas in places like Bangalore. And instead, the incentives would now go to those creating jobs inside the U.S., in places like the Buffalo, a city bordering Canada in upstate New York.

Announcing the international tax policy reform, Obama said, “We will stop letting American companies that create jobs overseas take deductions on their expenses when they do not pay any American taxes on their profits. We will use the savings to give tax cuts to companies that are investing in research and development here at home so that we can jump start job creation, foster innovation, and enhance America’s competitiveness.”

The new tax laws are expected to hit badly the countries like India, China and Philippines, where U.S. companies have been outsourcing their work. Chastising the current taxation system, Obama said, “It’s a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York.”

The U.S. President further said, “The way we make our businesses competitive is not to reward American companies operating overseas with a roughly two percent tax rate on foreign profits; a rate that costs taxpayers tens of billions of dollars a year.”

Obama wants U.S. companies to remain most competitive in the world. “But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens,” he argued.

Announcing a set of proposals to crack down on illegal overseas tax evasion, close loopholes, and make it more profitable for companies to create jobs here in the U.S., Obama said his series of tax reforms would save $210 billion in the next 10 years.

HONG KONG – Asian stock markets tumbled Tuesday, with Hong Kong’s index down nearly 4 percent, after relentless fears about the financial system and world economy drove Wall Street to its worst finish in more than a decade.

Every major market shuddered from losses across a range of sectors, from banks to technology firms, exporters and commodities, wiping out solid gains from the previous day.

Tokyo’s benchmark languished near a 26-year low as news that Nomura Holdings , Japan ’s biggest broker, will raise billions more in capital by selling shares added to worries about the financial sector.

Most Asian bourses advanced strongly Monday on reports the U.S. government may take a greater stake in tottering financial giant Citigroup .

But concerns that Citigroup and other banks will keep suffering severe losses flared overnight amid pessimism about a quick economic recovery and doubts the government can return the reeling financial system to working order.

As the Obama administration tried to pacify fears, saying it would launch a revamped bank rescue program this week, U.S. investors hammered stocks. The Dow Jones and Standard & Poor’s 500 indexes plummeted to their lowest closes since 1997.

“Investors are just selling out in disgust across the board — disgust with the market, disgust with the financial problems,” said Lorraine Tan, director of equities research at Standard & Poor’s in Singapore .

“The government seems to keep throwing in money, but there doesn’t seem to be any end to the declines or solutions to the problems,” she said.

In Japan, the Nikkei 225 stock average lost 107.60 points, or 1.5 percent, to 7,268.56, but traded of its lows. Hong Kong’s Hang Seng sank 478.07, or 3.6 percent, to 12,697.01, while South Korea’s Kospi fell 3.2 percent to 1,063.88.

Shanghai’s benchmark, among the year’s best performers so far, dropped 4.3 percent as China’s central bank said the country’s economic downturn could worsen and warned the risk of deflation is “quite big” amid collapsing consumer demand. The bank’s report could temper expectations that China’s slump might be bottoming out and a recovery might be taking shape,

Elsewhere, Australia’s stock measure was off 0.6 percent, and Singapore’s benchmark lost 1.8 percent. Indexes in Singapore, Taiwan and India shed more than 1 percent.

Overnight, U.S. investors seemed unconvinced after regulators promised to ensure the viability of banks by providing capital and said they would start conducting “stress tests” on Wednesday to gauge the health of financial firms.

Amid the assurances, however, came more reports of financial gloom.

Struggling insurer American International Group Inc . said it’s evaluating “potential new alternatives” to tackle its financial problems amid reports it will soon announce a $60 billion loss and ask the government for more aid.

After the markets closed, JPMorgan Chase said it was slashing its quarterly dividend to preserve capital in case economic conditions drastically worsen.

The Dow plunged 250.89, or 3.4 percent, to 7,114.78. It last closed this low on May 7, 1997 when it finished at 7,085.65. The Dow hasn’t traded below the 7,000 mark since October 1997.

While S&P 500 managed to close above its Nov. 21 trading low, considered a key threshold among investors, it still took a beating. The benchmark fell 26.72, or 3.5 percent, to 743.33. It was the lowest close since April 11, 1997.

Stock futures suggested Wall Street would rise modestly Tuesday. Dow futures were up 52, or 0.7 percent, at 7,168 and S&P500 futures were up 6, or 0.8 percent, at 751.

Oil prices languished in Asian trade, with light, sweet crude for April delivery down 36 cents at $38.08 a barrel the New York Mercantile Exchange . The contract lost 4 percent, or $1.59, to settle at $38.44 overnight.

In currencies, the dollar strengthened to 95.16 yen from 94.43 yen. The euro was up slightly at $1.2719 from $1.2705.