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India Controls 44% of the
offshore outsourcing market - Nasccom.
NASSCOM, the chamber of commerce
and 'voice' of the IT software and services industry in
India, today announced the findings of its annual survey
on the performance of the Indian IT-ITES* industry
(excluding hardware) and the outlook for FY
2005-06.
As per the NASSCOM survey, the
Indian IT-ITES industry has recorded 34.5% growth in
exports, clocking revenues of USD 17.2 billion in FY
2004-05 (euro 14.07 billion), as compared with export
revenues of USD 12.8 billion in 2003-04. Of the total
IT-ITES exports in FY 2004-05, IT software and services
grew by 30.5%, registering revenues of USD 12 billion;
while ITES-BPO segment clocked revenues of USD 5.2
billion, recording a growth of 44.5%. NASSCOM has
projected that the Indian IT-ITES exports are likely to
grow by 30-32% in FY 05-06, clocking revenues of USD
22.5 billion.
According to NASSCOM findings, the
overall Indian IT-ITES industry (including domestic
market) grew by 32% in FY 2004-05 registering revenues
of USD 22 billion, up from USD 16.7 billion in
2003-04.
Canada is the nearest competitor
with a 32 percent share; China has 4.9 percent and
Eastern European countries have 4.5 percent.
Key Figures
(2004-2005)............................ USD
billion
IT Software and Services
.............................16.2
Domestic..........................................................4.2
Exports............................................................12.0
ITES-BPO........................................................
5.8
Total IT-ITES
(IT Software and Services +
ITES-BPO) ........ 22.0
Exports.............................................................17.2
Domestic............................................................4.8
Key highlights of the NASSCOM
survey
- Industry employee base crossed
the 1million mark in FY05 -IT Software and services
employee base has grown at a CAGR of 23.6%, from 242,
000 in FY 2001-02 to 697,000 in FY 2004-05.
- ITES-BPO employee base has grown
at a CAGR of 52.6%, from 42,000 in 2001-02 to 348,000 in
FY 2004-05 -Indirect employment attributed to IT-ITES
was 2.5 million in FY 04-05
- Total value of outsourcing to
India (USD 17.2 billion in 2004-05) is estimated to be
44% of the worldwide total.
- Offshore penetration of Fortune
500 increased by 33% in 2004 (from 300 in 2003 to 400
companies in 2004).
- Vast majority of SMEs registered
a growth of about 20-22% in revenues.
- FY 2004-05 revenue from product
development and R&D services was USD 3 billion, up
from USD 2.3 billion in FY 2003-04.
- The top 4 players alone have over
660 clients in the USD 1 million + category, up from 441
in FY 2003-04.
- While US and UK still remain the
dominant markets, Indian companies are gaining traction
in newer geographies like Japan, Singapore and
Germany.
- While India continues to lead in
traditional segments, vendors are now also gaining
ground in newer services such as packaged software
implementation, systems integration, network
infrastructure management and IT consulting.
- Significant untapped potential,
rapid adoption and small base likely to result in high
growth (rate) in domestic BPO.
- Pricing trends in BPO likely to
be susceptible to downward pressure, increasing the
emphasis on operational excellence to sustain
margins.
- Integration of IT-BPO contracts
to become more common.
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