Indian Information Technology Sector

  • 10,883 views
Uploaded on

One of the fastest growing sectors in India, IT-ITeS has been growing at a CAGR of 30 per cent. …

One of the fastest growing sectors in India, IT-ITeS has been growing at a CAGR of 30 per cent.

With such huge potential, IT-ITES is one of the key thrust areas of Government of India.

Liberal Policy framework for the sector
- Continuous liberalisation and reform policies of Government of India had a positive impact.

- Liberalisation and reforms in the telecom sector have had a direct impact on the industry\'s competitiveness and created further avenues for the growth of IT and BPO sectors.

Export promotion and Tax/duty incentives
- Foreign Trade Policy 2004 - 2009 permits import of all kinds of computers (Except second hand computers) in India without any licences.

- EPCG Scheme for software sector allows import of capital goods at 5 % basic customs duty subject to undertaking certain export commitments - A number of Special schemes including Export Oriented Unit , Special Economic Zone etc offer a wide range of duty concessions and exemptions for IT exports.

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
  • Tamil Nadu Police Result 2008

    http://web-pedia.blogspot.com/2008/12/tamil-nadu-police-result-2008.html

    Tamil Nadu Police Result 2008

    http://web-pedia.blogspot.com/2008/12/tamil-nadu-police-result-2008.html
    Are you sure you want to
    Your message goes here
No Downloads

Views

Total Views
10,883
On Slideshare
0
From Embeds
0
Number of Embeds
0

Actions

Shares
Downloads
822
Comments
1
Likes
1

Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
    No notes for slide

Transcript

  • 1. www.imacs.in
  • 2.
    • Market Overview
    • Government regulations & policy
    • Advantage India and business opportunities
    Contents
  • 3. Market Overview
    • Market Overview
    • Government regulations & policy
    • Advantage India and business opportunities
  • 4.
    • Revenues ~ USD 36 billion (2006 Est.)
      • CAGR (FY 2004-06) - 30 %
      • Contribution to GDP up from 2% in 2000 to 5% in 2006
    • Exports ~ USD 23.5 billion (2006 Est.)
      • CAGR (FY 2004-06) - 35 %
      • Has nearly doubled in last three years
    • Domestic Market - USD 13 billion (2006 Est.)
      • CAGR (FY 2004-06) - 22%
      • Buoyed by an economy growing at nearly 8% per annum over the last 3 years
    IT-ITES one of the fastest growing sectors in India Market Overview Source: NASSCOM CAGR - 30% CAGR - 35%
  • 5. Exports contribute nearly 65 % of IT sector revenue
    • IT services and ITES-BPO revenue largely export driven
      • Exports contributed 75% of IT services and 87% of ITES-BPO revenue
    • Share of services in domestic market increasing
      • Revenue from services up from 43% to 47 % in the last 3 years
    Segment wise revenue trend Source: NASSCOM Market Overview 100% = USD 21.7 bn Year 2004 100% = USD 28.5 bn Year 2005 100% = USD 36.4 bn Year 2006 (E) IT services ITES- BPO Engg Services, R&D and products Hardware
  • 6. Business pressures and India advantages continue to drive off-shoring
    • The Global Offshore Delivery Model adopted by Indian software services vendors and increasing sophistication to sustain delivery over the last decade or more is already translating into more work being handled off-shored
    • IT companies have developed capabilities to handle larger slices of work offshore and provide substantial value to customers facing pressure to drive down costs while maintaining quality
    • Continued pressure on margins and tangible benefits from off shoring is expected to substantially increase the momentum in offshore outsourcing.
    Source: NASSCOM Market Overview S h a r e o f O f f s h o r e c o m p o n e n t o f r e v e n u e o n t h e r i s e 4 3 % 5 5 % 6 4 % 7 4 % 5 7 % 4 5 % 3 6 % 2 9 % 2 0 0 0 2 0 0 2 2 0 0 4 2 0 0 6 ( E ) % of revenue O n s h o r e O f f s h o r e
  • 7. India’s IT industry structure is vibrant and competitive Source: NASSCOM Market Overview < USD 100 million (IT) < USD 10 million (BPO)
    • 10-15% of IT Services
    • 5% of BPO
    >3000 Emerging players USD 25 million-USD 150 million (top 10 units)
    • 50% of BPO
    150 Captive BPO USD 10 million-USD 200 million (Excl. leader - USD 500 million)
    • 20% of BPO
    40-50 Pure play BPO USD 10 million-USD 500 million
    • 10-15% of IT Services
    • 10-15% of BPO
    20-30 Offshore operations of Global IT majors USD 100 million-USD 1 billion
    • 25% of IT Services
    • 4-5% of BPO
    7-10 Tier II > than USD 1 billion
    • 45% of IT Services
    • 4-5% of BPO
    3-4 Tier I Revenue Performance Share of export revenue No. of players Category
  • 8. Government regulations & policy
    • Market Overview
    • Government regulations & policy
    • Advantage India and business opportunities
  • 9.
    • Liberal Policy framework for the sector.
      • Continuous liberalisation and reform policies of Government of India had a positive impact
      • Liberalisation and reforms in the telecom sector have had a direct impact on the industry’s competitiveness and created further avenues for the growth of IT and BPO sectors
    • Export promotion and Tax/duty incentives
      • Foreign Trade Policy 2004 - 2009 permits import of all kinds of computers (Except second hand computers) in India without any licenses.
      • EPCG Scheme for software sector allows import of capital goods at 5 % basic customs duty subject to undertaking certain export commitments
      • A number of Special schemes including Export Oriented Unit , Special Economic Zone etc offer a wide range of duty concessions and exemptions for IT exports
    IT-ITES is one of the key thrust areas of Government of India India’s federal governments have comprehensive IT policies to facilitate greater investments in the sector Government regulations & policy
  • 10. India has enacted comprehensive legislation (IT Act 2000) which covers copyright protection and cyber laws
    • Copyright and IPR
      • Intellectual Property Rights (IPR) of computer software covered under the Copyright Law.
      • Copyright of computer software protected under the provisions of Indian Copyright Act 1957.
      • Major changes to Indian Copyright Law were introduced in 1994 and came into effect from 10 May 1995, making, Indian Copyright law, one of the toughest in the world.
    • Regulatory norms in Indian cyberspace
      • Comprehensive legislation for Information Technology - The Information Technology Act 2000 enacted.
      • Aims to provide the legal infrastructure for e-commerce in India
      • India only the 12 th nation globally to enact cyber laws.
    Government regulations & policy
  • 11. Advantage India and Business opportunities
    • Market Overview
    • Government regulations & policy
    • Advantage India and business opportunities
  • 12. India’s cost and talent pool advantage is well established
    • India with 28% has the largest share of the global talent pool
    • While China with around 11% stands next, the use of English as the official business language gives India a significant edge
    • India also continues to hold a significant labor advantage over developed countries thus offering significant cost saving opportunties by off shoring
    • India lead among potential outsourcing destinations as per the A T. Kearney Global Services Location Index 2005
    Source: McKinsey Report, The Emerging Labour Market, June 2005 Advantage India and business opportunities
  • 13. Rising FDI and PE are indicative of India’s advantage and global interest Source: NASSCOM CAGR 178.6% Advantage India and business opportunities S e c t o r N u m b e r o f D e a l s V a l u e ( I N R B n ) I T - I T E S 3 3 1 9 . 9 M a n u f a c t u r i n g 2 3 1 5 . 4 H e a l t h c a r e a n d L i f e S c i e n c e s 1 3 9 B F S I 6 6 . 6 T e x t i l e s 1 2 6 . 5 FDI in IT-ITES Private Equity in IT -ITES
  • 14. India’s IT exports to touch US$ 60 billion by 2010
    • Global IT-ITES spending to cross USD 1198 billion by 2010
    • The addressable market for offshore IT services and BPO industry is estimated at be USD 150-180 billion and USD 120-150 billion respectively
    • With USD 13 billion, India has less than 10% of the current addressable market
    • India expected to be well on track to achieve USD 60 billion by 2010.
    Source: Nasscom. The IT Industry in India - Strategic Review 2006 Advantage India and business opportunities India Others Untapped potential
  • 15. India’s IT spending is providing significant opportunities
    • India’s domestic market is also set to grow substantially, having grown at a CAGR of 22% over the last three years
    • India’s spending on software and services has grown at a CAGR of 27%
    • Large Indian corporates have already begun to outsource their entire IT activities
    • A number of large outsourcing deals have been stuck in the domestic market in the recent past, with the Banking and Financial Services Space and Telecom being the noteable sectors.
    • India will be the fastest growing market in Asia Pacific in terms of IT spending
    • Servers shipments are expected to cross 100,000 during 2006
    • Outsourcing Services to outgrow Technology Product Services in 2006 and would contribute to nearly of 24% of Indian IT Services market
    • Excerpts from India Top 10 ICT Market Predictions 2006
    Advantage India and business opportunities
  • 16.
    • Tata Consultancy Services Ltd.
      • Ranked 1 in 2005 by NASSCOM
      • Incorporated - 1968
      • Revenues - USD 2.97 Bn
      • 71,000 employees
    India’s tier 1 companies
    • Infosys Technologies Ltd.
      • Ranked 2 in 2005 by NASSCOM
      • Incorporated - 1991
      • Revenues - USD 2.04 Bn
      • 52,700 employees
    • Satyam Computer Services Ltd.
      • Ranked 4 in 2005 by NASSCOM
      • Incorporated - 1987
      • Revenues - USD 0.72 Bn
      • 24,798 employees
    • Wipro Technologies Ltd.
      • Ranked 3 in 2005 by NASSCOM
      • Incorporated - 1997
      • Revenues - USD 1.81 Bn
      • over 50,000 employees
    Advantage India and business opportunities
  • 17. The India Brand Equity Foundation is a public-private partnership between the Ministry of Commerce & Industry, Government of India and the Confederation of Indian Industry. The Foundation’s primary objective is to build positive economic perceptions of India globally India Brand Equity Foundation c/o Confederation of Indian Industry 249-F Sector 18, Udyog Vihar Phase IV Gurgaon 122015, Haryana, INDIA Tel +91 124 401 4087, 4060 - 67 Fax +91 124 401 3873 Email j.bhuyan@ciionline.org Web www.ibef.org
  • 18. Disclaimer This publication has been prepared by ICRA Management Consulting Services (IMaCS) for the India Brand Equity Foundation (“IBEF”). All rights reserved. All copyright in this publication and related works are jointly owned by IBEF and IMaCS. The same may not be reproduced, wholly or in part in any material form (including photocopying or storing it in any medium by electronic means and whether or not transiently or incidentally to some other use of this publication), modified or in any manner communicated to any third party except with the written approval of IBEF. This publication is for information purposes only. While due care has been taken during the compilation of this publication to ensure that the information is accurate to the best of knowledge and belief of IBEF and IMaCS, the content is not to be construed in any manner whatsoever as a substitute for professional advice. IBEF and IMaCS neither recommend nor endorse any specific products or services that may have been mentioned in this publication and nor do they assume any liability or responsibility for the outcome of decisions taken as a result of any reliance placed on this publication. IBEF or IMaCS shall in no way, be liable for any direct or indirect damages that may arise due to any act or omission on the part of the user due to any reliance placed or guidance taken from any portion of this publication. ICRA Management Consulting Services Limited