The Indian information technology (IT) sector’s market size was recorded at US$ 76 billion during 2010-11. As a proportion of India’s gross domestic product (GDP), the contribution of IT sector has risen from 1.2 per cent in 1998 to 6.4 per cent in 2011.
Indian firms have become multi-national companies (MNCs) with delivery centres across the globe and employs over 2 million people directly and over 8 million indirectly. The industry is well diversified across verticals like BFSI, telecom, retail. Indian market offers a strong pool of young and experienced professionals.
Total exports from the IT sector stands at US$ 59 billion during the year 2011. IT services’ exports has been the major contributor to the exports market of India with exports of over 57 per cent of the total IT exports during 2011.
The US has traditionally been the biggest importer of Indian IT exports and during 2010, over 60 per cent of Indian IT-BPO exports worth US$ 30.1 billion were absorbed by the US. Demand from emerging countries is expected to show strong growth going forward. Tax holidays are extended to IT sector. Further, special economic zone (SEZ) scheme since 2005 is helping IT companies with single window approval mechanism and tax benefits. Growing Indian economy is boosting the local demand of IT products. Besides, India is providing procedural ease and single window clearance for setting up facilities. The domestic market is expected to cross US$ 50 billion by 2020.
India has the opportunity to tap the growing offshoring market with its cost advantage, expertise and huge talent pool.
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