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Hyderabad, Apr 12: Indicating that prolonged lockdown to contain coronavirus spread may lead to job cuts in the Indian IT industry, NASSCOM former president R Chandrashekhar has said that the work-from-home culture may become a positive development in the long run as it opens up newer avenues and save investments by IT firms.

The former bureaucrat also said startups which are surviving on funds infused by venture capitalists may face tougher situations if the present scenario deteriorates.

"The larger companies may not be actually cutting jobs for two reasons. One is that they do not want to lose their employees and they have money to pay. Many of them ( big companies), even if they do shed some jobs it might be at the most people who are on temporary or intern type and all. But they would not want regular and permanent employees to go. So as long as they have sufficient flexibility in their books, they would continue," said NASSCOM former president.

"But beyond a point that it goes on, for let us say, two months or three months, then even for them, they will feel the pressure. They may not just keep on providing subsidies to the employees. So the key question will be how long that goes on," Chandrasekhar said.

He also said the work-from-home systems being adopted by several firms across the globe, including India, may have a negative impact on the industry in the short-term, but in the long run it would change the work culture which hitherto was not experienced by many of the IT firms in India.

 On impact of the prolonged lockdown on startups, he said it would be a big challenge for the budding enterprises as the investments they get are based on their ideas and future revenues and the present situation under which peoples movement is curbed may shackle their progress.

 "Where will they (startups) get money to pay salaries to their employees. Venture capital investors would not pay the money or invest their money to pay salaries because they are not in the charity business."

If the employees are not paid and if they leave and it is difficult for the startup againto come up. So the whole investment plan goes for a toss, he said.

Former chairman of NASSCOM, B V R Mohan Reddy said a clear picture as to what is going to happen has not yet emerged as the situation with all respects is still evolving. Reddy said there will be a demand shrinkage for the IT industry as the entire world is under stress. "There is no economy in this world that is going to do well in this situation.

So, therefore, there will be a demand shrinkage, he said, indicating tougher times of the industry ahead.

Jun 1: Gold prices rose on Monday as riots in major U.S. cities rattled investors already reeling from strained Sino-U.S. relations and boosted demand for the safe-haven metal, with a weaker dollar lending further support.

Spot gold gained 0.8% to $1,739.75 per ounce by 0242 GMT. U.S. gold futures ticked up 0.1% to $1,752.60.

"Concerns about the unrest in the United States at the moment appear to be weighing on market sentiment," said Michael McCarthy, chief strategist at CMC Markets, adding that rising tensions between the world's top two economies provided further support to gold.

Protesters have flooded the streets in the United States over the death of George Floyd in police custody, in a wave of outrage sweeping a politically and racially divided nation.

The closely packed crowds and demonstrators not wearing masks have sparked fears of a resurgence of COVID-19, which has killed more than 101,000 Americans.

In Asia, China's state media and the government of Hong Kong lashed out on Sunday at U.S. President Donald Trump's pledge to end Hong Kong's special status if Beijing imposes new national security laws on the city.

Gold is often used as a safe store of value during times of political and financial uncertainty.

Indicative of sentiment, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.3% to 1,123.14 tonnes on Friday, a fresh seven-year high.

Further supporting gold's appeal, the dollar index fell 0.4% against its rivals.

Elsewhere, silver jumped 2% to $18.20 per ounce, its highest since Feb. 26, before retreating slightly to trade 1.8% higher at $18.16.

Speculators cut their bullish positions in COMEX gold and increased them in silver contracts in the week to May 26, the U.S. Commodity Futures Trading Commission said on Friday.

Palladium rose 0.7% to $1,958.25 per ounce, while platinum declined 0.3% to $835.56.