Indian IT software, services grow 31.4%: Nasscom

Nasscom recently announced the findings of its annual sur-vey on the
performance of the Indian software and services industry (excluding hardware)
and the outlook for FY 2006-07.

According to the survey, the Indian IT-ITeS industry has recorded 33 percent
growth in exports, clocking revenues of $23.6 billion in FY 2005-06, as compared
with export revenues of $17.7 billion in FY 2004-05.

Financial year 2005-06 also saw the overall Indian IT-ITeS industry
(including domestic market) growing by 31 percent and registering revenues of
$29.6 billion, up from $22.5 billion in 2004-05.

Of the total IT-ITeS exports in FY 2005-06, IT software and services grew by
33 percent, registering revenues of $13.3 billion; while ITeS-BPO segment
clocked revenues of $6.2 billion, recording a growth of 37 percent. Engineering
services and product exports grew from $3.14 billion in FY 04-05 to $4 billion
in FY 05-06. Domestic market clocked revenues of $6 billion in FY 04-05 from
$4.8 billion in FY 05-06.

Nasscom has projected overall software and services will grow by 25-28
percent clocking revenues of $36-38 billion in FY07. IT-ITeS exports are likely
to grow by 27-30 percent in FY 06-07, posting revenues between $29-31 billion.

Kiran Karnik, President, Nasscom said, “The excellent performance of the
Indian software and services industry once again reinforces our confidence that
the industry is on course to meet the projected target of $60 billion exports by
FY 10, as projected in the Nasscom McKinsey report. This growth is also
reflected in the employment trends, both direct and indirect, which according to
our estimates is to the tune of 4.3 million.

“With less than 10 percent of the market currently addressed, a large
market opportunity exists for the sector which will ensure sustained demand led
growth. Factors like evolution of global delivery model, unbundling of large IT
outsourcing deals with larger India-based delivery shares, and the large
contract values due for renewal over next two years are some of the positive
indicators for the sector. In the last year India's strength has emerged
through large client wins, cross-border mergers and acquisitions, movement of
the industry towards stable pricing model and a gradual positive shift in the
outsourcing debate.”

DQW News Bureau Bangalore, June 2