Infosys Refuses To Shutdown Russian Operations, Despite Announcing Shutdown 8 Months Ago
Even after announcing 8 months ago that Infosys is going to pull out operations from Moscow, the Indian IT services company is still operating. It is through the same company that the prime minister’s wife collects £11.5m in annual dividends.
In the Russian capital, the company which retains a staffed office, is paying subcontractors in the Russian capital to carry out IT services for a global client.
Wife of PM Rishi Sunak, Akshata Murty, is the daughter of the billionaire founder of Infosys, NR Narayana Murthy, has a 0.91% stake in the company worth £690m that rewards her with multimillion-pound annual dividends.
Earlier this year, She agreed to pay tax on her Infosys dividends both in the UK and in India after an outcry over her “non-dom” tax status that had allowed her to avoid liability in Britain.
A source close to Murty said her investment was a legacy from her father and that she had no operational role in the company.
After accusations from a Ukrainian politician that the then chancellor’s family was earning “blood money” via its Moscow operation, Infosys had announced in March that it was transitioning out of Russia.
Sunaks Questioned Over Benefitting From Russian Money
The Sunaks also had to face the flak and pressure exerted by the Labour and the Liberal Democrats who asked them whether they were benefiting financially from Russian money at a time when Vladimir Putin’s troops were waging war in Ukraine.
It was in the month of April, that the company announced that it was “urgently” seeking to close its office. Seven months on from that statement of intent, Infosys’s Moscow office retains a company plaque on an outside wall and company sources confirmed that administrative staff continued to work there as part of a transition.
The sources said the remaining staff had been tasked with removing the IT equipment before a move to India or disposing of it in a “sustainable” way.
There were questions raised about the speed with which the company is extricating itself.
Angela Rayner who is the Labour’s deputy leader, condemned the PM over the continued presence of Infosys in Moscow and claimed Sunak had “failed to get his own house in order” while preaching to others. She said that “It’s utterly scandalous that six months after Infosys said it would urgently pull out of Russia, the Sunak family could be materially benefiting from Moscow-based operations.
She also alleged that PM’s private conflicts of interest compromise the sanctions levied by him on Russia. She said “The prime minister’s tough talk on sanctions on Putin is compromised by his private conflicts of interest. When he was chancellor Rishi Sunak ordered UK businesses to reconsider any investments that would in any sense support Putin and his regime but he’s utterly failed to get his own house in order.”
On the other hand, other IT giants like SAP, Oracle, PwC, McKinsey, Accenture and KPMG, closed their Russian operations soon after the invasion of Ukraine on 24 February.
On the other hands, those organizations who did not move out of Russia immediately, found it difficult to stay in the country due to the western economic sanctions.
However, the Indian government has been more ambivalent in its stance.
In September, India’s prime minister, Narendra Modi, said there was “immense potential” for cooperation with Russia in the field of energy and there has long been an attempt in Delhi to get closer to Moscow.
When Putin visited the corporate headquarters of Infosys in Bangalore in 2004, NR Narayana Murthy, as its chairman, claimed that “Mr Putin’s visit to India is an affirmation of the special relationship between our two countries. India and Russia share several common values and have already successfully leveraged each other’s strengths across various industry sector”.
“Blood Money That Sponsors Army”
A Ukrainian MP, Lesia Vasylenko, who has been vociferously defending her country said that the money paid out in dividends by any company operating in Russia should be viewed as “bloody money” that had “sponsor[ed] the army”.
An Infosys spokesperson said: “Since the start of the year, Infosys has taken several steps to suspend its operations in Russia, and all Infosys employees supporting client projects have been transitioned out.
“Infosys does not have any active relationship with local Russian enterprises. The process of transitioning a few remaining partner and administrative staff is under way.”
A Downing Street spokesperson said: “Neither Akshata Murty nor any members of her family have any involvement in the operational decisions of the company.”