Indian IT and ITes Industry Analysis

India is the world’s largest sourcing destination, accounting for approximately 52 per cent of the US$ 124-130 billion market. The country’s cost competitiveness in providing IT services, which is approximately 3-4 times cheaper than the US continues to be its unique selling proposition (USP) in the global sourcing market.


The IT-business process management (BPM) sector in India grew at a compound annual growth rate (CAGR) of 25 per cent over 2000-2013, which is 3-4 times higher than the global IT-BPM spend, and is estimated to expand at a CAGR of 9.5 per cent to US$ 300 billion by 2020.


Export of IT services has been the major contributor, accounting for 57.9 per cent of total IT exports (excluding hardware). BPM accounted for 23.5 per cent of total IT exports during FY13. Total exports from the IT-BPM sector (excluding hardware) were estimated to have been US$ 76 billion during FY13, with exports growing at a CAGR of 13.1 per cent during FY08-13E.


The Government of India has extended tax holidays to the IT sector for software technology parks of India (STPI) and special economic zones (SEZs). Further, the country is providing procedural ease and single window clearance for setting up facilities.


Traditional verticals, i.e., BFSI, telecommunication and manufacturing, continue to remain the largest in terms of IT adoption and are expected to grow at an average of 15 per cent. Implementation of cloud environment and mobility is the way forward for such verticals.


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Source: IBEF

Disclaimer: This information has been collected through secondary research and NICCT is not responsible for any errors in the same.

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