Nasscom cuts growth estimate to 8-10%

Driven by strong and stable fundamentals, Nasscom on Wednesday has reiterated that the long term opportunity and potential for the industry remains unchanged with a vision to achieve $350 billion by 2025.

As part of its mid-year performance review of the IT-BPM industry, the Nasscom also shared its revised guidance stating that the industry is expected to grow at 8-10 per cent (in constant currency) during this financial year.

In October, it had said it expects the $143-billion IT sector to grow at 10-12 per cent.

Highlighting the impact of short-terms factors like global, political and economic and business scenarios, it said that the industry remains in a strong position as it charts the future growth path for itself.

“The industry is going through a transient phase with various domestic and global factors impacting its performance. While the effect of various short-term factors may show for a couple more quarters, the worst is behind us,” R Chandrashekhar, President, Nasscom, said.

He said global projected growth for the industry is high and the industry’s share remains strong. “We are confident that the sector will continue to re-invent itself by investing in digital technologies and competencies, to drive consistent and sustained growth,” he added.

In the current fiscal year, the industry continued to evolve with a focus on innovation, efficiency, enabling transformation and agility while partnering with clients in their digital initiatives, the industry body said in its performance report.

Technology disruptions are reshaping businesses and increasingly global and Indian enterprises are focusing on building technology-led platforms that can redefine how their services and solutions can be delivered, it said.

Global IT-BPM spends on digital services have increased by 2X since 2014 and technology buyers are now expanding outside the CIO organisation, thus creating a unique opportunity for technology providers.

Technology and software is becoming a universal and integral part of modern businesses and society. Traditional firms are also aiming to become software and analytics companies, Nasscom said.

Global software and IT services globally is set to grow at a healthy pace of 7.2 per cent and 4.4 per cent respectively in 2017. To stay globally competitive, the need of the hour is for Indian firms to invest in the future and enhance their digital capabilities. This entails a mix of re-skilling, domain and platform capabilities coupled with acquisition led competencies, it said.

India currently is the biggest Global in-house centres (GIC) locations globally, with over 1,000 centers focused on technology, services, R&D and innovation. The country is also the third largest start-up ecosystem in the world with over 4,750 firms, witnessing a growth of 10-12 per cent annually.

Further, the industry has diversified into new verticals (healthcare, retail, etc) and is now exploring largely untapped geographies like Continental Europe, which are witnessing 2X incremental growth with respect to last year, Nasscom added.