IT's shining, exports soar to $17bn

The Indian tech story shows no signs of slowing down. India today commands an impressive 44% share of the total global outsourced market. Technology exports from India rose in FY05 to $17.2bn, a 34.5% growth over $12.8bn earned in previous fiscal.

This was revealed by Nasscom, the trade body for technology service industry, at a press meet on Thursday said. Projected IT and ITES export growth in the current fiscal is $22.5bn, a 30-32% increase.

Growth on a big base is a challenge and the industry needs considerable support from the government specifically on infrastructure front and also through supportive policies said Kiran Karnik, president, Nasscom. The total value of outsourcing to India in ’04 is estimated at 44% of the world-wide total. It is forecast to reach $48bn by ’08. IT software and services exports were up at $12bn, a 30.5% growth over the previous $9.2bn, while ITES revenues were $5.2bn, a 44.5% jump over $3.6bn.

Nasscom said that the exports and domestic Indian IT and ITES industry together grew by 32% to register $22bn revenues, from $16.7bn last fiscal. Domestic software and services revenues stood at $4.2bn, while the domestic ITES revenues were $0.6bn.

Domestic market revenues in FY04 were $3.9bn. “The Indian software and services industry has been able to maintain its growth momentum and consolidate its partnership with overseas customers, adding to their competitiveness,” said S Ramadorai, chairman, Nasscom.

To sustain the competitive advantage that India enjoys, the technology industry must engage closely with academia to create the right talent pool, collaborate with the hardware industry in micro electronics and embedded software, maximise employment opportunities and elevate service excellence through R&D and quality benchmarked delivery, he further added.

Mr Karnik said that the performance of the Indian software and services export industry shows that it is on track to attain the projected target of $50bn in FY09.

“The healthy growth validates the outsourcing model,” he added. Many Indian vendors established presence in high margin segments and there was a steady growth in traditional service lines in the ITES-BPO sector, last fiscal, said Mr Karnik.

Nasscom is working to increase collaboration among Indian companies to share ideas, information and best practices in order to sustain and grow the domestic market.

Extensive use of IT within the country can result in great economic benefit, efficient and transparent governance, and empowerment of the disadvantaged he added.