Bengaluru, NFAPost: India’s information technology sector is set to post a 2.3% rise in revenues to $194 billion in the current fiscal, theNational Association of Software and Service Companies (Nasscom) said on Monday. This growth is despite a dip in global technology spending amid the coronavirus pandemic.
It is interesting to note that IT&ITES companies added 1.38 lakh people to its workforce on a net basis during the year, taking the total number of employees to 44.7 lakh. Nasscom presented these statistics as part of its review of the current financial year ending March 31.
Over the past few years, the industry has been clocking a revenue growth in higher single digits or double digits as the demand for IT services in a digitising world continues to grow. However, the pandemic led to a sharp dip in growth hitting tech spend while the lockdown also led to concerns over delivery as work shifted from campuses to homes.
Nasscom’s President Debjani Ghosh said the industry reworked its models amid the lockdowns and ensured that work continues to get delivered as per schedules, and IT is now the first sector to call out a revival post-pandemic.
“We have emerged more resilient and more relevant from the crisis. We have been the bellwether to lead the fight against Covid,” Debjani Ghosh said.
Exports for the fiscal year ending March 2021 are set to grow 1.9% to $150 billion while domestic revenues are projected to rise at a faster clip of 3.4% to $45 billion, the industry lobby group said.
IT services segment will grow 2.7% to $99 billion while Business Process Management (BPM) will see a growth of 2.3% at $38 billion. Software products segment will witness a growth of 2.7% at $9 billion and hardware grow 4.1% to $16 billion.
In terms of outlook, Nasscom pointed to some of the listed companies mentioning about a pipeline of over USD 15 billion while a survey of 100 chief executives also painted a positive picture.
As per the survey findings, 71% of the respondents are expecting a significantly higher tech spend in 2021 and 95% of the CEOs said their hiring will be higher than the 2020 levels during the new year.
Debjani Ghosh said Nasscom has identified artificial intelligence, Internet of Things and cyber security as the focus areas which will hold the sector in good stead going forward. A fourth of the Indian workforce is digitally skilled, which will make it possible to take on the newer opportunities in the upcoming areas, she said.
When asked about the future of the huge campuses from where industry players operate, Nasscom’s Chairman Pravin Rao did not give a clear answer but added that offices will be important from culture-setting and also innovation perspective.
Pravin Rao, who is the Chief Operating Officer of Infosys, said Nasscom expects better policies from the newly inaugurated President Joe Biden-led administration in the industry’s key market of the US with easier immigration norms.
The Biden administration has already put on hold some of the earlier decisions taken by the Trump administration on immigration, and Nasscom expects fruitful consultations on the same once the officials settle down, he said, hinting that there will be an increase in people being sent to the US but it may be the ones with higher experience.
The body said there has been a 4% jump in offshoring during FY21 as the pandemic led to a shift in working from home, making the physical location of an associate less important.
There has also been a 10% shift to outcome-based pricing models as against the earlier practice of fixed pricing of contracts based on man-hours. Rao said this reflects confidence within the industry to effectively demonstrate its capabilities and added that this is because pilot projects are moving to full-fledged implementation.