Growing IT Sector In India

 IT Sector India

This fast-growing part of India's IT sector will require 5 lakh professionals. India's software-as-a-service industry could reach $1 trillion in value and create nearly half million new jobs by 2030 as businesses around the world accelerate digitization and automation, according to a new study.

 

The Indian information technology (IT) industry is expected to touch $300-350 billion in terms of revenue over the next five years, McKinsey has stated in its yet-to-be-released report. This means the industry will clip a growth rate higher than the 7.5 per cent that it has been growing in the last five years.

Tata Consultancy service [TCS] is the No 1 IT company in India in terms of Revenue and Market capital.

The global sourcing market in India continues to grow at a higher pace compared to the IT-BPM industry. India is the leading sourcing destination across the world, accounting for approximately 55% market share of the US$ 200-250 billion global services sourcing business in 2019-20.

 

The IT industry accounted for 8% of India’s GDP in 2020. Exports from the Indian IT industry are expected to increase by 1.9% to reach US$ 150 billion in FY21. In 2020, the IT industry recorded 138,000 new hires. According to STPI (Software Technology Park of India), the software exports by its registered units increased by 7% YoY to reach Rs. 5 lakh crore in FY21 from Rs. 4.66 lakh crore in FY20, driven by rapid digitization and the IT industry's timely transition to remote working environments that helped to keep up the industry’s growth amid coronavirus pandemics.

 

The IT & BPM industry’s revenue is estimated at ~US$ 194 billion in FY21, an increase of 2.3% YoY. The domestic revenue of the IT industry is estimated at US$ 45 billion and export revenue is estimated at US$ 150 billion in FY21. According to Gartner estimates, IT spending in India is estimated to reach US$ 93 billion in 2021 (7.3% YoY growth) and further increase to US$ 98.5 billion in 2022.

 

Indian software product industry is expected to reach US$ 100 billion by 2025. Indian companies are focusing to invest internationally to expand global footprint and enhance their global delivery centres. In line with this, in February 2021, Tata Consultancy Services announced to recruit 1,500 technology employees across the UK over the next year. The development would build capabilities for TCS to deliver efficiently to the UK customers.

 

The data annotation market in India stood at US$ 250 million in FY20, of which the US market contributed 60% to the overall value. The market is expected to reach US$ 7 billion by 2030 due to accelerated domestic demand for AI.

 

Indian IT's core competencies and strengths have attracted significant investment from major countries. The computer software and hardware sector in India attracted cumulative foreign direct investment (FDI) inflows worth US$ 69.29 billion between April 2000 and September 2020. The sector ranked 2nd in FDI inflows as per the data released by Department for Promotion of Industry and Internal Trade (DPIIT). In FY21, computer software and hardware topped FDI investments, accounting for 44% share of the total FDI inflows of US$ 81.72 billion.

 

Leading Indian IT firms like Infosys, Wipro, TCS and Tech Mahindra are diversifying their offerings and showcasing leading ideas in blockchain and artificial intelligence to clients using innovation hubs and research and development centres to create differentiated offerings.

 

 

In May 2021, Infosys entered a partnership with Majesco, a New Jersey-based cloud insurance software solutions provider, to enable insurance companies to aid in digital adoption and transformation across the insurance value chain.

 

In May 2021, HCL Technologies (HCL) announced a multi-year contract with Hitachi ABB Power Grids to build a new greenfield digital foundation as part of a global transformation programme.  Through this engagement, HCL will help Hitachi ABB Power Grids establish a new, efficient and modern independent IT organisation.

 

In May 2021, Tata Consultancy Services (TCS) joined forces with VIAVI Solutions, a network test, measurement and assurance solutions company, to launch new test solutions that address the industry’s need for comprehensive testing of next-generation disaggregated 5G radio access network (RAN) products.

 

In May 2021, Tata Consultancy Services (TCS) partnered with LACChain, an initiative led by IDB Lab, the innovation laboratory of the Inter-American Development Bank Group, to boost adoption of a blockchain ecosystem across Latin America and the Caribbean.

In May 2021, IBM collaborated with 11 top-tier academic institutions, including IIT Kharagpur and the Indian Institute of Science (IISc), Bangalore, to enable ‘over-the-cloud’ access to its quantum systems to boost advanced training and research in the area of quantum computing.

 

In May 2021, Infosys announced a definitive agreement to acquire GuideVision, a ServiceNow Elite Partner in Europe.

 

 

In May 2021, MyGov, the citizen engagement platform of the Government of India, in partnership with the Department of Higher Education launched an innovation challenge to create an Indian language learning app.

 

In order to establish an enabling environment for the IT industry, in April 2021, the Development of Advanced Computing (C-DAC) launched three innovatice technologies Automatic Parallelizing Compiler (CAPC), Cyber Security Operation Centre (CSoC) as a Service, and C-DAC’s indigenous High-performance Computing software solutions—Parallel Development Environment (ParaDE).

 

In Budget 2021, the government has allocated Rs. 53,108 crore to the IT and telecom sector.

 

Department of Telecom, Government of India and Ministry of Communications, Government of Japan signed a MoU to enhance cooperation in areas of 5G technologies, telecom security and submarine optical fibre cable system. In 2020, the government released “Simplified Other Service Provider” (OSP) guidelines to improve the ease of doing business in the IT Industry, Business Process Outsourcing (BPO) and IT-enabled Services.

 

India is the topmost offshoring destination for IT companies across the world. Having proven its capabilities in delivering both on-shore and off-shore services to global clients, emerging technologies now offer an entire new gamut of opportunities for top IT firms in India. The industry is expected to grow to US$ 350 billion by 2025 and BPM is expected to account for US$ 50 55 billion of the total revenue.

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