New Delhi, June 3: Software exports this year are forecast to rise by 26 per cent — the same rate as it did in 2002-03.
The cautious forecast by the National Association of Software and Services Companies (Nasscom) is both good and bad news: it’s bad because it is an acknowledgement that the quicksilver growth rates of 50-60 per cent a couple of years ago is gone forever.
On the flipside, it’s good news because the growth rate will be maintained at fairly decent levels despite the Iraq war which forced global corporations to pare IT investments, the SARS-induced global economic downturn, the hardening rupee (which makes software exports harder), visa restrictions in several countries, including the US, and the growing tendency in some US states to stop the flight of outsourcing jobs, especially call-centre related ones, to countries like India.
The major growth driver in 2003-04 in the software and services sector is expected to be the IT-enabled services and business process outsourcing (ITES-BPO). According to Nasscom, the ITES-BPO is expected to grow by 50 per cent contributing about 29 per cent to the total software and service exports in the next financial year.
Nasscom projects IT services, products and technology services to register a growth of 17 per cent to reach revenues of over $ 8.4 billion. The ITES-BPO segment is projected to register a growth of 54 per cent to clock revenues of $ 3.6 billion during the financial year 2003-04.
“We have seen that this year too, the ITES-BPO sector has continued its momentum, growing more than twice the industry average and capturing a quarter of India’s total IT software and services exports. With the fundamentals and the value proposition of India as the IT destination being robust, we are optimistic of maintaining the growth trajectory,” says Nasscom chairman Som Mittal.
The software and services industry grew by 26.3 per cent during financial year 2002-03 at Rs 46,100 crore as against Rs 36,500 crore during last year. The IT services, products and technology services grew by 18.3 per cent while the ITES-BPO grew by 59 per cent during 2002-03.