Pandemic has not led to reduction in IT office space: HYSEA

Contrary to popular perception there has been no significant reduction in the office space by the IT and BPO firms in Hyderabad.

“We have recently conducted a survey among the IT firms in Hyderabad. No company told us that they are reducing the space or not renewing their lease agreements,” Bharani Kumar Aroll, President of Hyderabad Software Enterprises Association (HYSEA) told BusinessLine.

Some of the IT SMEs did face the issue of cash flow initially. “But since the demand for IT and digitisation have gone up as the pandemic progressed, the situation has improved of late,” he said.

HYSEA represents IT and BPO companies in Hyderabad that exported ₹1.28 lakh crore worth exports in 2019-20. This is expected to touch the ₹1.40-lakh crore mark in 2020-21.

Bharani Kumar, however, said that there were a few small companies that had reduced space by about 25 per cent owing to lack of deals. “With regard to startups, there’s no significant impact on them. Traditionally, only about 10 per cent of them survive. There is not much change in that equation,” he said.

“Though there is some impact in the first quarter of 2020-21 (when the pandemic began) on the investment flow into start-ups, there has been no dearth in investment pipeline now,” he said.

Cloud CoE

He said the cloud adoption rate has been growing up very fast across the world. Pegging the global cloud market size at $325 billion, he said the market size was going up at a compound annual growth rate (CAGR) of 18 per cent.

“There is a huge scope for the Indian IT industry in this space as the cloud market size expected to touch the $1-trillion mark in the next few years. The scope of the cloud space is expanding as services like business-process-a-service (BPAS) and IAAS (infrastructure-as-a-service) are being offered over the cloud,” he said.

In this backdrop, the HYSEA is planning to set up the Cloud Centre of Excellence (Cloud CoE) soon with the help of large cloud services and platform providers in the country. The 10,000-sq ft facility will give cloud players access to technologies and services. It will also help in building human resources in various cloud technologies.

Focus on MSMEs

The HYSEA President said the association would ask the State government to come out with an exclusive policy to promote to micro, small and medium enterprises (MSMEs).

“The Government has already set up a panel to look into helping the MSMEs getting access to government projects. We think there is a need for a sector-specific policy to promote the small and medium companies,” he said.

Women Leaders’ Forum

The HYSEA will soon start an exclusive forum for women leaders in the association. “Though the presence of women at the lower spectrum of the industry hovers up to 40 per cent, their number is small at the higher levels. In order to increase the discourse among the women leaders, we are going to start a Women Leaders’ Forum soon,” he said.

He said the outlook for the IT industry in 2021-22 looked promising as firms began to report good deal pipelines and economy recovering faster from the recession.

R Srinivasa Rao, Chief Operating Officer of HYSEA said the association would also ask the State government to promote engineering and research and development ecosystem in order to widen the business opportunities for the IT industry.