Software industry in India : Current situation, Future and Growth of IT industry in India

Software industry in india :

The IT & BPM sector has become one of the most significant growth catalysts for the Indian economy, contributing significantly to the country’s GDP and public welfare. The IT industry accounted for 7.4% of India’s GDP in FY22, and it is expected to contribute 10% to India’s GDP by 2025.

As innovative digital applications permeate sector after sector, India is now prepared for the next phase of growth in its IT revolution. India is viewed by the rest of the world as having one of the largest Internet user bases and the cheapest Internet rates, with 76 crore citizens now having access to the internet.

The current emphasis is on the production of significant economic value and citizen empowerment, thanks to a solid foundation of digital infrastructure and enhanced digital access provided by the Digital India Programme. India is one of the countries with the quickest pace of digital adoption. This was accomplished through a mix of government action, commercial innovation and investment, and new digital applications that are already improving and permeating a variety of activities and different forms of work, thus having a positive impact on the daily lives of citizens.

India’s rankings improved four places to the 46th position at the 2021 edition of the Global Innovation Index (GII).

History :

India's IT Services industry was born in Mumbai in 1967 with the establishment of Tata Consultancy Services who in 1977 partnered with Burroughs which began India's export of IT industries.services. The first software export zone, SEEPZ – the precursor to the modern-day IT park – was established in Mumbai in 1973. More than 80 percent of the country's software exports were from SEEPZ in the 1980s.

Within 90 days of its establishment, the Task Force produced an extensive background report on the state of technology in India and an IT Action Plan with 108 recommendations. The Task Force could act quickly because it built upon the experience and frustrations of state governments, central government agencies, universities, and the software industry. Much of what it proposed was also consistent with the thinking and recommendations of international bodies like the World Trade Organization (WTO), International Telecommunication Union (ITU), and World Bank. In addition, the Task Force incorporated the experiences of Singapore and other nations, which implemented similar programs. It was less a task of invention than of sparking action on a consensus that had already evolved within the networking community and government.

In 1991 the Department of Electronics broke this impasse, creating a corporation called Software Technology Parks of India (STPI) that, being owned by the government, could provide VSAT communications without breaching its monopoly. STPI set up software technology parks in different cities, each of which provided satellite links to be used by firms; the local link was a wireless radio link. In 1993 the government began to allow individual companies their own dedicated links, which allowed work done in India to be transmitted abroad directly. Indian firms soon convinced their American customers that a satellite link was as reliable as a team of programmers working in the clients' office.

• 2.Indian IT revenues :

  
  
  
  
  

The IT industry accounted for 8% of India’s GDP in 2020. Indian IT's core competencies and strengths have attracted significant investment from major countries. The computer software and hardware sector in India attracted cumulative foreign direct investment (FDI) inflows worth US$ 74.12 billion between April 2000 and June 2021. The sector ranked 2nd in FDI inflows as per the data released by Department for Promotion of Industry and Internal Trade (DPIIT). Japanese investments in the Indian IT sector grew 4X between 2016 and 2020. Investments stood at US$ 9.2 billion in the review period. Leading Indian IT firms like Infosys, Wipro, TCS and Tech Mahindra are diversifying their offerings and showcasing leading ideas in blockchain and artificial intelligence to clients using innovation hubs and research and development centres to create differentiated offerings.

According to STPI (Software Technology Park of India), software exports by the IT companies connected to it stood at Rs. 1.20 lakh crore (US$ 16.29 billion) in the first quarter of FY22. The export revenue of the IT industry is estimated at US$ 150 billion in FY21. Secondly as per Gartner estimates, IT spending in India is estimated to reach US$ 93 billion in 2021 (7.3% YoY growth) and further increase to US$ 98.5 billion in 2022. The BPM sector in India currently employs more than 1.4 million people, while IT and BPM together have more than 4.5 million workers, as of FY21. Going forward, the revenue share of platform-as-a-service and software-as-a-service in the overall software market is going to increase from 37.1% in 2020 to 59% in 2025.

3.Major information technology hubs :

Bangalore :

Bangalore is a global technology hub and is Indias biggest tec hub. As of fiscal 2016–17, Bangalore accounted for 38% of total IT exports from India worth $45 billion, employing 10 lakh people directly and 30 lakh indirectly. The city is known as the "Silicon Valley of India". Notable tech parks are Electronic City, ITPL, Bagmane Tech Park, Embassy Golf Links, Manyata Tech Park, Global Village Tech Park, Embassy TechVillage. Apart from these IT companies are also located in several other parts of the city. Notable IT companies of the area include Infosys, Wipro, HCL Technologies, SAP Labs, Accenture, TCS, Oracle, IBM India, Sonata Software, Mindtree, and Intuit India.

Bangalore is also known as the "startup capital of India"; the city is home to 44 percent of all Indian unicorn startup companies as of 2020.

Hyderabad :

Hyderabad – known for the HITEC City or Cyberabad – is India's second largest information technology exporter and a major global IT hub, and the largest bioinformatics hub in India. Hyderabad has emerged as the second largest city in the country for software exports pipping competitors Chennai and Pune. Notable techcompaniesinclude Microsoft , Amazon, Google, Apple, Salesforce, Capgemini, Accenture, AMD, Deloitte,Intel,TataConsultancyServices,HCLTechnologies,OracleCorporation, Qualcomm, Dell, Cognizant, Novartis, Pega, J.P Morgan, UBS. As of 2022, the IT exports from Hyderabad was ₹183,569 crore (US$23 billion), the city houses 1500 IT and ITES companies that provide 7,78,121 employment. Notable tech and pharma parks are Nanakramguda Financial District, HITEC City, Genome Valley, and Hyderabad Pharma City. The number of startups in Telangana had increased from 400 in 2016 to 2,000 in 2022. Hyderabad added two companies in unicorn startup list in first two months of 2022.Microsoft, Amazon, Google has their largest campus outside US in Hyderabad.

Chennai :

As of 2018, Chennai is India's third-largest exporter of information technology (IT) after Bangalore and Hyderabad and business process outsourcing (BPO) services. TIDEL Park in Chennai was billed as Asia's largest IT park when it was built. Notable tech parks are International Tech Park, DLF Cybercity SEZ, Mahindra World City, SIPCOT IT Park, Olympia Tech Park, One Indiabulls Park, L&T Estancia IT SEZ, Ramanujan IT City and Chennai one SEZ. City has an expressway called as IT expressways and a preferred location for IT industries. Major software companies such as Tata Consultancy Services, Infosys, Zoho, Capgemini, Amazon, Mindtree, Cognizant, Accenture, UST Global, Sify, BirlaSoft, HCL Technologies and Comcast have their offices set up here, with some of them making Chennai their largest base.

Pune :

The Rajiv Gandhi Infotech Park in Hinjawadi is a ₹60,000 crore (US$8.9 billion) project by the Maharashtra Industrial Development Corporation (MIDC). The IT Park encompasses an area of about 2,800 acres (11 km²) and is home to over 800 IT companies of all sizes. Besides Hinjawadi, IT companies are also located at Magarpatta, Kharadi, Kalyani Nagar, Yerawada, Aundh and several other parts of the city. Major IT companies like TCS, Wipro, Infosys, Cognizant, IBM, Accenture, Tech Mahindra, Cybage, Zensar Technologies, Amdocs, Capgemini, Quick heal, Amazon, FIS (Company), HCL Technologies, Barclays, Credit Suisse, UBS, Netcracker Technology, Persistent Systems,KPIT. Harbinger Knowledge Products have offices in Pune. As of 2019, the IT sector employs more than 500,000 people.

Delhi NCR :

Delhi NCR is one of the major IT hub in India. Cities in NCR like Gurgaon and Noida have several companies that serves the local and global markets who take help from these IT hubs. Major software companies like Microsoft, Oracle Corporation and Adobe Systems have their presence in Noida.

Ahmedabad :

Ahmedabad is also one of the major IT hub in Gujarat , India. The company like ManekTechwhich has 350 + employees also exist in the city of Ahmedabad.

Kolkata :

Kolkata is one of the major IT hub in India. As of 2020, The IT sector employs more than 200,000 people directly. Major software companies such as Tata Consultancy Services, Capgemini, Wipro, Ericsson, Mindtree, Cognizant, Accenture, ITC Infotech, RS Software have their offices set up here, with TCS making Kolkata their largest base.