IT body Nasscom on Wednesday said the fundamentals of the domestic IT industry are strong but it will "watch" the performance in the next two quarters in the wake of "uncertain" global economic environment.

"Market is really uncertain. But I think fundamentals of our industry are also very strong. It is true that economic environment is uncertain and we will watch the next two quarters," Nasscom president Som Mittal told reporters.

On the sidelines of 'Surge 2012' seminar organised by the IT software industry body, he said rupee depreciation against the US dollar helps the industry only in long-term and businesses do not gain much during short-term.

"The rupee depreciation helps us in the long term because it ensures competitiveness for the industry. But in the short run, we do not really gain because as an industry we do not want currency movement to be in the centre of loss or profit. Because most people want to get what they have projected in terms of pricing," he said.

"We need a stable currency rather than guessing how far dollar and rupee will be. We hope the government will bring more stability," he added.

Asked about IT companies entering new geographies, Mittal whose term as Nasscom chief was extended for two more years on Tuesday, said: "People are now picking up new geographies. Natural growth is happening in Europe, Latin America and Middle East. For short term opportunities, we will be going to newer geographies like Latin America, Middle East and Asia. But in the longer term, we will be focusing on places were the need is higher," he said.

To a query on expectations from the government, he said stability in policies was needed because it would build trust between government and the business.

"I think this is the time we need the government to offer some support -- not in terms of any incentives, but as much as stable policies and more positive relationship between business and industry," he said.

On employment in the IT industry, he said projections were that 1,60,000 to 1,80,000 jobs should be created this year. "We have given offers to more than 1,00,000 students in engineering colleges," he added.

Last year, Nasscom had predicted that 2,00,000 new jobs would be created in the industry.