T-BPM (excluding e-commerce and hardware) export revenue stood at an estimated $177.9 billion in FY21, slightly up y-o-y from $174.3 billion reported in FY20 as compared to a jump from $161.8 billion in FY19.

Analysts attributed it to the impact of Covid in the first three quarters of FY21. The pent-up demand was eventually carried forward and executed in FY22 wherein the path for steady recovery and double-digit growth was set for the coming years, according to the Survey.

A similar slowdown was observed in the FDI equity inflows trends across services sectors. “In H1 2020-21, FDI equity inflows into ‘Computer Software & Hardware’ sub-sector was $17.55 billion. It has declined by $10 billion to reach $7.12 billion in H1 2021-22. However, this is still 77 per cent higher than the FDI equity inflows into this sub-sector during H1 2019-20,” the Economic Survey report said. H1 2021-22 mentioned here is from April to September 2021.

Overall FDI equity inflows into services sectors dropped in H1FY22 by 29 per cent, driven by the fall in computer software and hardware sub-sector.

According to a Nasscom report, “the IT-BPM services revenue reached $194 billion in 2020-21, adding 1.38 lakh employees during the same period.”

Double digit growth

“There was a decline in three quarters of FY21. Many companies showed negative growth during this period. IT companies growth came post that. There were both supply and demand side challenges. In FY22, we are expecting double digit growth and estimating there will be around 20 per cent growth in the overall IT sector. On a 2-year CAGR basis, you will see at least 8-9 per cent growth, similar to earlier average. In fact the industry is doing much better than what it had done in FY19 and FY20,” Pareekh Jain, CEO of EIIRTrend, told BusinessLine.

He added, “During Covid, every company big and small had to go digital and on cloud thus leading to demand for IT services growing manifolds eventually. Because of this there was pent up demand which is being solved for at the moment. We expect further multi-year double digit growth for the IT companies going ahead. “