THE WORST ever financial crisis to have ravaged the United States since the Great Depression of 1930s, has taken a heavy toll on the world’s largest economy. There is rise in the number of job layoffs and cost cutting. In fact, all the economies of the world are facing crisis to tackle this global meltdown. The meltdown has led to shock waves across the world, with economy after economy gasping for breath to survive this financial tsunami.
Citigroup on Monday (November 17), decided to lay off 53000 employees in the coming months and slash its expenditure by 20 per cent next year. The measures are part of the Citigroup’s efforts to overcome the huge losses it has suffered in the last four straight quarters, including $2.8 billion in the third quarter.
Recently, HSBC announced its plan to shed 500 jobs in Asia, following the slump. The bank decided to trim its work force because of ’organizsational changes in a number of areas as well as the deteriorating economic conditions and our cautious outlook for 2009’, Peter Wong, an executive director for Hong Kong and China, said in an internal message released by the bank. Now DLF has also frozen few of its plans and has cut down few jobs as well. “We must have laid off some employees somewhere,” DLF chairman KP Singh told reporters on the sidelines of India Economic Summit, but did not give the number of jobs that were cut.
Our finance minister has maintained that India will not be much affected by the recession but the fact remains that Indian Inc are getting hit by this slump worldwide. The stock market in the country has crashed in last few months.
The Sensex fell 353 points to end at 8,937 levels while in the broader markets Nifty closed lower by 116 points at 2,683 today. The investors have been dampened by the global recession and corporate layoffs. Investors are discomforted by news, the financial sector is still struggling. The entire world seems to be sinking into recession. Indians all over the world are very susceptible to the recession and are living on edge. There are hardly any new jobs available in the market and retaining one’s job can be considered to be a luxury.
There is no doubt that if the global economies suffer then India is also bound to suffer. But the very fact that India is a domestic consumption- and investment-driven market where contribution of exports to the growth is not as big goes in its favour to tackle this crisis in a much better way than few of the other emerging economies. The inflation rate has also reached in some what comfortable zone and thus economists believe that the government has more room now to focus on the growth rate of our economy.