The Indian software and services market continues to demonstrate impressive growth, despite recent reports of companies bringing their IT requirements back ‘onshore’.
According to the Indian IT services association, Nasscom, the total value of the Indian software and services industry for the fiscal year 2006-07 was $39.6 billion. This figure represents an impressive 30% increase compared to the year-ago period ($30.5bn). Nasscom reports that the growth rate is likely to dip slightly during the next financial year. However, it is still predicted to be within the region of 24% to 27%, thereby giving the lie to any suggestion that the Indian IT services boom is over.
The Nasscom figures show that global spending (excluding the domestic market) on Indian IT services reached $18 billion in the year 2006-07, up 35.5% year on year. Spending on business process outsourcing services was up 33.5% in the same period, at $8.4 billion.
Nasscom predicts that the market will continue to grow to reach $50 billion in the year 2007-08, and if estimates are correct, hit $60 billion in 2009-10. However, it also warned this growth is reliant on factors such as: favourable exchange rates; sustained availability of talent; the continued development of India’s transport and utility infrastructure; and the continuation of the supportive regulatory environment.