Software Engineer

Topics: Economic growth, International trade, Revenue Pages: 45 (3469 words) Published: April 15, 2014











The IT-BPM sector in India is estimated to expand at a CAGR of 9.5 per cent to USD300 billion by 2020. The sector increased at a CAGR of 25 per cent over 2000–13, 3-4 times higher than global IT-BPM spend



India is the world’s largest sourcing destination, accounting for approximately 52 per cent of the USD124–130 billion market. The country’s cost competitiveness in providing IT services, which is approximately 3-4 times cheaper than the US continues to be its USP in the global sourcing market

Largest pool of ready to
hire talent



India’s highly qualified talent pool of technical graduates is one of the largest in the world, facilitating its emergence as a preferred destination for outsourcing

Most lucrative sector for
investments



The sector ranks fourth in India’s total FDI share and accounts for approximately 37 per cent of total Private Equity and Venture investments in the country

Strong growth
opportunities

Leading sourcing
destination

Source: NASSCOM; Aranca Research
Note: BPM - Business Process Management, USP - Unique Selling Proposition

Growing demand
Growing demand

2013E


Global footprints

Strong growth in demand for
exports from new verticals





IT firms in India have delivery
centres across the world; as of
2012, IT firms had a total of
580 centres in 75 countries



Industry
value:
USD108
billion

2020F

India’s IT & ITes industry is
well diversified across verticals
such as BFSI, telecom, retail

Expanding economy to propel
growth in local demand

Industry
value:
USD300
billion

Advantage
India
Competitive advantage





India has cost savings of 60– 70
per cent over source countries
India remains a preferred
destination for IT & ITeS in the
world. With 52 per cent market
share, India continues to be a
leader in the global sourcing
industry
The country has a huge talent
pool

Policy support




The engineering sector is delicensed;
Tax per cent FDI is allowed the IT
100 holidays extended to in the
sector
sector

••

Due scheme since 2005 to benefit
SEZ to policy support, there was
cumulative FDI of USD14.0 window
IT companies with single billion into
the sector over April 2000
approval mechanism, tax– February
2012, making
benefits,etc up 8.6 per cent of total
FDI into the country in that period

Source: Nasscom, Aranca Research
Note: SEZ stands for Special Economic Zone, BFSI stands for Banking, Financial Services and Insurance; E stands for Estimate, F stands for Forecast

2005 onwards
2000–05

1995-2000



Pre-1995







By early 90s,
US-based
companies
began to
outsource work
on low-cost and
skilled talent
pool in India



IT industry started to
mature
Increased
investment in R&D
and infrastructure
started
India increasingly
seen as a product
development
destination



The number of firms
in India grew in size
and started offering
complex services
such as product
management and
go-to market
strategies
Western firms set
up a number of
captives in India






Firms in India became
multinational companies
with delivery centres
across the globe (580
centres in 75 countries,
as of 2012)
Firms in India make
global acquisitions
The IT sector is expected
to employ about 3.0
million people directly
and around 9.5 million
indirectly, as of FY13
India’s IT sector is at an
inflection point, moving
from enterprise servicing
to enterprise solutions



Market Size: USD56.3 billion during FY13



Over 78 per cent of revenue comes from the export market



BFSI continued as the major vertical of the IT sector

Business Process
Management (BPM)



Market size: USD20.9 billion during FY13



Around 85 per cent of revenue comes from the export market

Software products and
engineering services



Market size: USD17.9 billion during...
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