IT Industry in India

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One of the most significant factors that have helped India make its mark on the world map is its booming IT industrial sector. The contributions being made by the IT industry towards the country's GDP has led to the steady growth of the Indian economy. India's IT industry is regarded as a hub of innovators providing world-class technology solutions across the globe.
Various international organizations have set up their offices here in India like Google, Accenture and others. It has helped in changing the Indian economy from an agricultural-based economy to a knowledge-driven economy.

The IT sector has helped the domestic economy to integrate with the world economy. It has made significant impacts on the lives of many people. It has also helped people settled in far-flung topographies to connect with the rest of the world. It has given birth to e-governance practices, as a result of which people get easy access via e-health, e-education, e-ticketing etc., to the various governmental services.

Now, almost everything can be done online whether it's shopping, ticketing, filing Income Tax returns etc. Though 2014 and 2020 were full of challenges and uncertainties, the IT sector managed to achieve a double-digit growth rate and attained revenues of USD 108 billion in the fiscal yearThe industry amounted to 8% of India’s GDP and registered 138,000 new hires in 2020.

Its timely transition to remote working environments assisted in maintaining the industry’s growth amid coronavirus pandemics. Indian software product industry is anticipated to reach US$ 100 billion or contribute 10% to the nation GDP by 2025.

Key drivers of growth in the IT sector

  • Low cost of operation and tax advantages
  • Supportive government policies
  • Availability of technically skilled workforce
  • Rapid introduction of IT technologies in major sectors such as telecom, BFSI.
  • Strong growth in export demand
  • use of new technologies like cloud computing
  • Government established SEZs

Government initiatives

After the economic reforms that were introduced in the state and central the government provided various incentives for better emergence of the IT sector like liberalization of external trade, removing duties on imports of IT products, setting up Export Oriented Units(EOU), setting up of Software Technical Parks(STP) etc.

The Government of India has also set up a National Task Force on IT and Software development to investigate the possibility of strengthening the economy.

Key concerns

With this fast pace sharing of information attributed to the rapid development of the IT sector, Cyber security and quality management are essential areas of concern. To avoid such malpractices, various BPO companies in India have started adopting the global quality standards like ISO 9001 for ensuring Quality Management and ISO 27000 for emphasizing information security.

Future prospects

As per the Gartner estimates, IT spending in India is projected to reach US$ 93 billion in 2021 (7.3% YoY growth) and further, improve to US$ 98.5 billion in 2022. The National Association of Software and Service Companies said that it included 1.38 lakh people in its workforce weekly during one year, making the total number of employees 44.7 lakh.

We have emerged more resilient and more relevant from the crisis. We have been the forerunner to lead the fight against Covid," Bloomberg Quint quoted NASSCOM president Debjani Ghosh is saying. The coronavirus pandemic led to a dip in flourishing while hitting tech spend. The virus-induced lockdown also led to rethinking over delivery as the work moved from campuses to homes.

However, the most critical factor for the continuous growth of the IT sector is innovation. The IT industries must always strive to come up with something new and must respond to the needs of the dynamic environment. The IT industrial sector should stand tough in the face of challenges and try to provide more and more end to end technology solutions to their customer base to keep the impetus growing.

Map showing IT Industry

India IT Company
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Last Updated on : July 28, 2021