Indian IT mart grew 21% in 2004, to $25 bn: IDC

International Data Corp (IDC), a US-based IT market research firm, said here on Friday, the Indian IT market had crossed $25 billion in sales in calender year 2004.

At a conference organised by the firm, on the year past and those ahead, IDC said $16.7 billion in IT sales in India came from exports, and $8.5 billion from the domestic market.

The IT market will grow to $65 billion (Rs 2.9 lakh crore) by 2009, showing a compounded annual growth of 21 per cent, Kapil Dev Singh, country manager at IDC's Indian subsidiary, IDC India, said.

Of this, IDC predicts some Rs 84,878 crore will be the domestic market, while exports will account for about Rs 2.06 lakh crore, Singh said.

In the 2004-09 period, the domestic market will grow an average of 17 per cent. The domestic market grew 22.9 per cent in 2004, driven by IT services, which grew 26 per cent, personal computers (25 per cent), network equipment (IDC calls them 'Datacom' products - 32 per cent), and printers, copiers and scanners (multi-functional devices - 48 per cent). The yea-on-year growth rate of the domestic market will peak this year, at 23.3 per cent, he said.

In the five years to 2009, the high growth categories in hardware will be notebooks, digital cameras, smart hand-held devices and wireless local area network equipment, IDC said.

In software, security, business intelligence, system management, information and data management, and storage will drive growth.

IT services will see enterprisewide outsourcing, network consulting and integration, software support, and system integration grow. "A closer look shows, mobility, convergence and IT infrastructure management will drive growth," Singh said.

The IT exports market grew 32 per cent (in rupee terms) in 2004, to Rs 75,477 crore in sales. IT services exports accounted for Rs 51,047 crore while IT-enabled services and hardware accounted for the rest. IDC said, growth in ITeS was mainly in business process outsourcing (BPO), which grew 42 per cent. In the five years to 2009, IT exports will grow an average of 22.2 per cent, IDC predicts.

Nasscom's numbers

IDC's numbers are at slight variance with those published last month by the National Association of Software and Services Companies (Nasscom).

In 2004-05 (ending March 2005), Nasscom said, Indian IT exports grew 34.5 per cent to $17.2 billion (Rs 77,710 crore at Rs 45.18 to a dollar that IDC used).

BPO exports grew 44.5 per cent, Nasscom said, to touch $5.2 billion (Rs 23,494 crore). This year, Nasscom predicts ITES BPO exports to grow 40.4 per cent, while it expects overall industry growth of between 30 per cent and 32 per cent to take export revenues to $22.5 billion.

The domestic IT market grew 23 per cent to $4.8 billion, including IT services of $4.2 billion and ITES-BPO of $0.6 billion. It will grow 25 per cent this year, Nasscom said. Overall industry will have to grow over 30 per cent to reach Nasscom's target of $50 billion by 2009.