The Information Technology (IT) has been one of the key driving forces fuelling India’s economic growth.
Availability of skilled talent has been a major reason behind India’s emergence as global outsourcing hub.
India has been competitive location globally and that is what has led to the growth of the industry.
- The contribution of IT sector has risen to 7.5% in FY 2012 from 1.2% in FY 1998.
- Software Services segment in India presently has an estimated Market size of USD 17.0 billion during FY 2012.
- IT Hardware market presently has a Market size of USD 13.0 billion during FY 2012.
- NASSCOM expects the country's Information Technology (IT) services sector to grow at a rate of 13-14% in the current financial year and expected to touch $225 billion mark (Rs 13.22 lakh crore) by 2020. The sector had been growing at a Compound Annual Growth Rate of 12-13%.
- At present, BFSI, Hi-tech, Telecom and Manufacturing contribute to around 80% of the IT services business in India, while Utilities, Transport, Healthcare and Media & Entertainment have opened new avenues for the industry.
- The increase in IT investments by Indian small and medium enterprises indicate constant progress in business maturity levels. Investments from the mid-market segment are expected to grow at a significant rate of 17.2%. Government initiatives and public private partnerships are bridging Infrastructure and Research & Development (R&D) gaps that inhibited SME growth.
- An interesting phenomenon of change has been witnessed in the Indian IT industry. 43 new tier II/III cities are emerging as IT delivery location. This could reduce pressure on leading locations.
IT Product Development
India is the global destination for technology product development. However India’s $108-billion IT sector is struggling to keep pace with challenging business environment. IT vendors all over are chasing for new business opportunities in IT domain. As a result India’s investment in S-M-A-C has gone up drastically. Customer investment in S-M-A-C is done through integration of
Market research firm IDC had estimated last year that that 90% of all growth from 2013 to 2020 will come through what it calls the 'third platform' and others refer to as SMAC. The Indian software industry’s exports may grow by about 13% in fiscal year 2014 to $87 billion (around Rs.5.4 trillion today), driven by its ability to offer solutions that integrate new business models such as analytics and cloud-based services, which are part of SMAC.
IT Captive Services
India has a dominant share in the Global Sourcing industry and IT Captives have a more important role to play in offshoring. Indian captives are world renowned for adding value to multinational businesses. IT captives are generally defined as a fully owned facility of a global company for
- IT support
- Software development
- Back office processing
- Call center operations
- Business process outsourcing
Over the years, operational environment for Indian captives has become tough with growth challenges and talent shortages. As captives expand their service offerings, they are increasingly being vowed as a service partner who is integral to core business functions.
IT Captives in India can be mainly classified into following categories
- Financial Services
- HealthCare Outsourcing
- Retail, FMCG and apparels.
IT Telecomm (Application Software and Hardware) Services
IT Telecomm Services comprise of all technology methods to gain control over Voice, Wireless and Network equipments.
IT telecomm services in India include
- Lifecycle management services, telecomm assessment, transition planning, design, data transformation management.
- Integrated solutions for Voice and Wireless services.
- Global delivery procedures.
- Dispute resolutions and redressal services.
- Continuous evaluation of equipment and contracts, ordering procedures.