Indian IT outsourcing sector’s exports are expected to grow by 12-14 per cent in the financial year starting April 2013, an optimistic estimate, while it would meet estimates this year.
The sector is expected to clock revenues of $84-87 billion in the current financial year on the rising global technology spends, according to industry body National Association of Software and Services Companies (Nasscom).
Domestic revenues are expected to grow at 13-15 per cent to reach Rs 1.18 lakh crore to 1.20 lakh crore, the industry body said in its ‘Strategic Review 2013’, adding that a rise in global technology spending and opportunities from adoption of disruptive technologies would propel growth in FY14.
In FY14, the industry expects to hire “more or less” the same numbers recruited during the year. The sector employed three million professionals and added more than 1.8 lakh personnel in FY13.
“Every process is getting re-imagined, and this is a tremendous opportunity in terms of products, in terms of processes and in terms of practices… This will only explode as we look at FY14 and beyond,” Nasscom Chairman N. Chandrasekaran said.
“The increase in IT spending will continue for the foreseeable time, with technologies such as social media, mobility, analytics and cloud fuelling growth,” Chandrasekaran, who is also the Chief Executive Officer and Managing Director at Tata Consultancy Services, said.
Smart computing, ‘anything’-as-a-service, technology enablement in emerging verticals and the small and medium business market are expected to open new opportunities for the industry.
“All the metrics are positive,” Nasscom President Som Mittal said. Indian IT services is a $50-billion sector, business process management (BPM) a $20-billion and engineering crossed $10 billion, while software products, Internet and mobility are emerging opportunities.
“Technology can also play a critical role in enabling transformation in India and add to India’s Gross Domestic Product. The domestic market in India is maturing, it was the fastest growing market in the year and Nasscom will look to partner with the Government in enhancing technology adoption in the country,” Mittal said.
MEETS FY13 ESTIMATES
For the fiscal ending March, the industry is expected to clock export revenues of $75.8 billion with a year-on-year (YoY) growth rate of 10.2 per cent on fluctuating dollar terms. While on a constant currency basis, it would be at 10.9 per cent.
“This growth is despite the challenges in the global market, including a slowdown in key markets such as the US and Europe,” Mittal said.
In February, Nasscom had estimated the industry to grow at 11-14 per cent, and in November reaffirmed growth at the lower end of the projections.
Domestic market also witnessed a growth rate of 14.1 per cent on YoY basis, increasing the domestic revenues to Rs 1,04,700 crore.
While the first $100-billion landmark can be attributed to the cost and quality advantage, the next $100 billion will be a combination of higher-value services and increasing non-linear growth, Nasscom said in a statement.
“To sustain this growth, Indian IT-BPM industry is focusing on greater efficiencies, verticalised structures, geographical presence, IP based solutions, domain and increased collaboration across all stakeholders,” it said.