Go BPO..Go...

The booming information technology (IT) sector has emerged the most happening sector in the country.The buoyant results for 2004-05 revealed it was yet another promising year and that the future too seems very bright.

It emerged a major engine of growth for the national economy as it leaped from revenue of just $ 12 million in 1980 to a huge $22 billion in 2004-05. It grew from strength to strength by permeating each and every sphere of life, be it manufacturing or services, automobiles or banking, telecom or retail trade, teaching or healthcare.

“Now India is a leading IT hub in the world, employing over a million-plus workforce within the country, serving domestic and overseas customers. Indirect employment generated by IT-enabled services (ITeS) and software industry is estimated to be 2.5 million, contributing heavily to the changing face of household incomes in both urban and rural areas,” an official release here today said.

The IT industry was highly optimistic about achieving the target of $ 50 billion in IT-ITeS exports by 2009.

Despite increasing human cost, global focus on business process outsourcing and ITeS was shifting towards India and an estimated 44 per cent of total value of outsourcing worldwide was garnered during the last financial year, way ahead of prime competitors like China.

The outsourcing market was expected to grow manifold in the immediate future as per studies by the National Association of Software and Services Companies (Nasscom). Robust growth in the number of new industries in IT sector, thanks to proactive government policies, promising market and enabling environment, would help tap a major share of the tremendous opportunity.

Nasscom had forecast that the value of work outsourced to India would reach $ 48 billion by 2008. The most encouraging factor was the growth of small and medium enterprises (SMEs). Many had established their roots in high margin segments as well. The SMEs helped generate more employment in metros and smaller towns too. The strong fundamentals of the IT sector in India were being reinforced, which was evident from the manifold growth of teledensity and personal computer (PC) penetration, the release said.

About 36.3 lakh PC units had been sold in the country last year, as assessed by the Manufacturers Association of IT (MAIT), an apex body of the it hardware industry.

Teledensity, another enabling factor for IT growth, also charted remarkable figures. India had already crossed the magical 100 million mark in the number of telephone connections. Broadband connectivity was fast catching up even in smaller towns and service providers had ambitious plans to offer value added services through broadband.

On cost competitiveness, India scored several notches higher than its competitors and gained a global brand image in IT.

In the comparative rating for offshore destinations studied by the consulting agency at Kearney, India was far ahead in people skills like BPO experience, size, labour availability, education, language and employee retention levels compared to other major players like China, Malaysia, Singapore, Philippines and the Czech Republic.

Though sustaining this would be a big challenge, India’s strengths in IT were manifold and the potential to retain the IT brand image was very sound as its strengths included rich manpower and quality-conscious software firms.

It now boasted of far more SEI CMM level 5 companies than any other country. Right since the early stages of the software industry, many firms aligned their quality management systems with ISO 9000 standards and were now graduating to higher levels of standards to sharpen their competitive edge, the release added.

To replenish the repertoire of varied and extensive skilled manpower in IT and ITeS, hundreds of reputed engineering colleges churned out thousands of engineering and science graduates who could communicate fluently in the global business language, English.

At a time when the population of those in the working age group was gradually declining in most developed countries, India, despite all the ills of over-population, had an increase in this segment. with phenomenal growth in software industry, pressure on basic infrastructure in metros would increase, the release pointed out .

However, with fast improving road, telecom and civil aviation sectors, which too had been registering unprecedented growth, and increasing availability of floor space for it firms on par with international standards, the metros had undergone a change of face.

At the same time, tier-II cities had also started creating history in their economic profile. Modestly known towns on the IT map like Coimbatore, Madurai, Tiruchirapalli, Mangalore, Kochi, Salem and Mysore were emerging as promising locations for IT and ITeS units, complementing crowded traditional hubs such as bangalore, the four metros, Hyderabad and other cities like Pune and Noida.

“Many states have established exclusive IT corridors such as the one on the old Mahabalipuram road in Chennai to attract major investments. The healthy competition among states serves as a boost for the industrial climate”, the release said.

Despite marginal opposition to BPO, it would be the mainstay in the foreseeable future as it was a win-win situation for those who exported jobs to offshore destinations and to those giving solutions.

“Research and development (R&D) is another promising area as major MNCs such as Siemens, Texas Instruments, Sun Microsystems, Intel, Samsung, Motorola, Philips, Delphi, Daimler and Bosch have set up research and development centres in the country”.

India’s major IT partners continued to be the US and Europe. It had been breaking new grounds in more geographic areas as well. “It is time for reputed firms to work on promoting indigenous software products more vigorously”.

Information technology was a major success story in India and the heavy investment flow into basic infrastructure sectors would have a multiplier effect on it as well, contributing to its robust growth.

Source: UNI