IBM has around 120,000 employees in India, around 90,000 in the US and around 20,000 in the UK.
Around 35 billion dollars of IBM's revenue ( ie: around 35% )comes from IBM India.
If they cutting in low cost centers, then you can imagine, how bad the things are.
I'm not so sure. IBM seems to hire really cheap developers in India, so it could be they've realized they need to hire better engineers in the first place.