IT & ITes
The IT-business process management (BPM) sector in India is estimated to expand at a CAGR of 9.5 per cent to US$ 300 billion by 2020.

Indian IT and ITeS Industry Analysis

Latest update: September, 2016

Burgeoning Indian talent pool;

• Availability of skilled English speaking workforce has been a   major reason behind India’s emergence as a global outsourcing   hub 

• During FY08-15 number of graduates addition to talent pool in   India grew at a CAGR of 9.4 per cent 

• India added around 5.8 million graduates to the talent pool during   FY15 

• Growing talent pool of India has the ability to drive the R&D and   innovation business in the IT-BPM space 

Growth

India's growing market size

• India’s technology and BPM sector (including hardware) is   estimated to have generated US$ 146 billion in revenue during   FY15 compared to US$ 118 billion in FY14, implying a growth rate   of 23.72 per cent

• The contribution of the IT sector to India’s GDP rose to   approximately 9.5 per cent in FY15 from 1.2 per cent in FY98

• The top six firms contribute around 36 per cent to the total   industry revenue, indicating the market is fairly competitive, with   TCS being the leader accounting for about 10.1 per cent

Growth

Last Updated: September, 2016

India is the world's largest sourcing destination, accounting for approximately 55 per cent of the US$ 146 billion market. The country's cost competitiveness in providing Information Technology (IT) services, which is approximately 3-4 times cheaper than the US, continues to be its Unique Selling Proposition (USP) in the global sourcing market. 

India’s highly qualified talent pool of technical graduates is one of the largest in the world and is available at a cost saving of 60-70 per cent to source countries. This large pool of qualified skilled workforce has enabled Indian IT companies to help clients to save US$ 200 billion in the last five years. 

India’s IT industry amounts to 12.3 per cent of the global market, largely due to exports. Export of IT services accounted for 56.12 per cent of total IT exports (including hardware) from India. The Business Process Management (BPM) segment accounted for 23.46 per cent of total IT exports during FY15.

The IT-BPM sector in India grew at a Compound Annual Growth rate (CAGR) of 15 per cent over 2010-15, which is 3-4 times higher than the global IT-BPM spend, and is estimated to expand at a CAGR of 9.5 per cent to US$ 300 billion by 2020.

The Government of India has extended tax holidays to the IT sector for software technology parks of India (STPI) and Special Economic Zones (SEZs). Further, the country is providing procedural ease and single window clearance for setting up facilities. 

Sectoral Presentation (September, 2016)

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IT & ITeS India

Sector-wise breakup of export revenue FY15E
IT Sector Employment Distribution in India

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