India’s apex software body Nasscom today estimated software services and business process outsourcing (BPO) export revenue to touch $49.7 billion (nearly Rs 2,30,000 crore) in 2009-10. The growth rate has been estimated at 5.5 per cent, on the back of increased cost efficiencies, utilisation rates and diversification into new verticals. Nasscom stuck to its earlier expectation of 4-7 per cent growth.
However, for the next financial year, 2010-11, Nasscom gave healthier projections for exports at 13-15 per cent and 15-17 per cent for the India market. Worldwide technology products and services spend is estimated to cross $1.5 trillion (over Rs 69 lakh crore) in 2009 – a decline of almost 3 per cent
“The growth was led by the domestic market, buoyed by increased government spending on information technology (IT). In addition, new areas like engineering services and product development displayed phenomenal momentum, clocking a combined revenue of over $10 billion (over Rs 46,000 crore),” Nasscom President Som Mittal said, while releasing the industry’s performance report card and next-year projections here today.
The industry growth rate has come down from 32 per cent four years ago to single digits now. In fact, with BPOs moving up the value chain to provide such high-end services as business analytics and knowledge-based services through a mix of re-engineering skills, technology-enabled platforms, new operating models and increased depth of services, BPO exports are estimated to grow 6 per cent to $12.4 billion (over Rs 57,000 crore).
“The penetration in BPOs is still very low. But BPO, along with cloud computing and remote infrastructure management, are expected to drive growth,” said Nasscom Chairman Pramod Bhasin.
Bullish on jobs front
On the hiring front, the industry remains bullish and is expected to be a net hirer, going ahead.
“The industry, which will continue to remain a net hirer, added 90,000 jobs in 2009-10 and is expected to add almost 150,000 jobs next year,” added Bhasin. Direct employment in the Indian IT-BPO sector is estimated to cross 2.3 million, while indirect job creation is estimated to reach 8.2 million.
Bhasin also expects greater IT adoption in retail, healthcare, telecom and BFSI (the banking, financial services and insurance vertical) and 80 per cent of growth to come from new areas.
“BFSI will always remain the biggest chunk, as it has the largest back office and spends the most on outsourcing,” he added. BFSI contributes almost 41 per cent to the industry’s revenues.
Over the past few years, revenue growth from the US had lagged other geographies.
