Just a few days after Infosys Technologies bagged a five-year, $50 million software development and maintenance contract from leading Australian telecom vendor Telstra, the deal has come under fire from workers' unions in Australia.

Nearly 200 people on Friday gathered outside Telstra's Melbourne office to protest against the deal.

The stiff opposition to the deal comes in the wake of Infosys taking over the responsibility from IBM Global Services Australia, a former joint venture between Telstra, IBM and Land Lease.

Workers fear that there will be job losses at IBM Australia as a result of the deal. When contacted, IBM India Ltd said, "There are no comments at the moment on the deal between Telstra and Infosys."

According to reports in the Australian media, the Community and Public Sector Union has estimated that 200-400 jobs will be lost at IBM Global Services as a result of Telstra's contract with Infosys.

Leigh Hubbard, secretary to the Victorian Trades Hall Council, told the media that the announcement that Infosys would expand its Australian operations did not guarantee that the jobs would remain in the country.

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Infosys may start with 200 people, but soon you will find that the staff strength has reduced to 50 or 100 and the bulk of the work is being done in India," said Hubbard.

Despite Infosys' announcement that it will hire 250 people to cater to the Telstra deal, it is not clear whether the contract will be serviced from Australia.

Trade unions in Australia are seeking an explanation on this issue. The Community and Public Sector Union said Telstra was involved in negotiations for several other outsourcing contracts, which could "affect 3,000-5,000 jobs".