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05. INFOTECH |
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Indian
IT-ITES Sector To Exceed USD 36 Billion in FY 2006 |
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NASSCOM, the
premier trade body and 'voice' of the IT software and
service industry in India, announced the key findings
of the Strategic Review 2006, on the eve of its fifteenth
annual event NASSCOM 2006: India Leadership Forum, held
from February 15-17.
Key Findings of NASSCOM
Strategic Review 2006 released
•
IT-ITES sector estimated to grow by 28%, to account for
4.8% of GDP in FY06
•
Employment in software and services sector to touch 1,287,000
•
Software and service exports to grow by 32%, to reach
USD 23.4 billion Commenting on the key findings of the
Strategic Review 2006 findings, Mr. S Ramadorai, Chairman,
NASSCOM and CEO & MD, TCS, said "The Indian IT-ITES
sector continues to chart double-digit growth and is expected
to exceed USD 36 billion in annual revenue in FY06. Out
of this, software and services exports are estimated to
grow by 32%, to reach USD 23.4 billion in FY06. Indian
IT-ITES is well on track to achieve the targets that the
industry aspires to achieve by the end of the decade."
Mr. Kiran Karnik, President, NASSCOM said, "2005
offered a steady growth for the industry. Along with increased
presence of Indian IT companies across the globe, we saw
new services lines emerging and the Industry reached the
next level in services offered. Mergers and acquisitions
by Indian players was also a key trend. Inspite of the
growth seen so far, it is estimated that less than 10
percent of the addressable market for globally sourced
IT-ITES has been captured till date, indicating significant
headroom for growth."
The Strategic Review 2006 reviews the industry's performance
in 2005, estimates the growth expected in the current
fiscal (FY06) details the service line trends observed
across the various industry segments over the past year,
presents an assessment of India's competitiveness as a
sourcing destination, analyzes the sustainability each
individual factor contributing to India's leadership position
and provides a view of the outlook projected for the global
and Indian IT-ITES industries - outlining the opportunities,
challenges and agenda for key stakeholders to further
extend India's leadership in this space.
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Key
highlights of the NASSCOM Strategic Review 2006
»
Steady growth: The Indian IT-ITES expected to exceed
USD 36 billion in annual revenue in FY06, an increase
of nearly 28 percent in this current fiscal
»
Exports to account for nearly two-thirds of the
total revenues IT-ITES sector to contribute to 4.8
percent of GDP in FY06
»
Engineering and R&D, software products hold
significant opportunity for India - growing at 37%
and 43% (CAGR FY 2003-06E), respectively
»
Indian IT-ITES sector on track to achieve the targeted
USD 60 billion in exports by FY 2010
BPO)
• Historical values for a few segments have
changed
• For ease of comparison, details for two preceding
years have been restated as per the new classification
Employment trends:
Total IT Software
and services employment to reach 1,287,000 in FY06
• Industry has
already initiated several initiatives to further
enhance the availability of and access to suitable
talent for IT-ITES in India
• A comprehensive skill assessment and certification
programmes for entry-level talent and executives
(low-middle level management) launched
• An image enhancement program to build greater
awareness about the career opportunities in this
segment
• NASSCOM is working with the academia across
the country to encourage and facilitate greater
industry interaction
• Figures do not include employees in the hardware
sector
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* Emergence of newer locations:
As global delivery matures, newer locations are
emerging; however India remains the undisputed
leader
• India maintains its distinctive lead amongst
offshore destinations
higher-value, more complex activities
From outsourcing to
global sourcing:
» Strong
fundamentals will help sustain India's value proposition
» 28%
of the suitable talent available across all offshore
locations (outranks the next destination by a
factor of 2.5)
» Keen
emphasis on security and quality
» Sustained
cost competitiveness, gains from increased productivity,
utilization and scale expansion
Growth in Domestic
market: Complementing the continued growth
in IT-ITES exports is a growing domestic market
• Domestic market coming into its own, to
grow by nearly 22% in FY 2006
• Strong demand over the past few years has
placed India amongst the fastest growing IT markets
in the Asia Pacific region
• Growth in the domestic market is witnessing
the early signs of service line depth that characterizes
maturing markets
• Global product companies are also looking
to introduce localized versions of their software
products to drive usability and penetration
• Several large domestic contracts announced
last year were won by MNCs
Coming of age of
Indian multinationals:
• Traditionally India-centric, indigenous
players beginning to build noticeable presence
in other locations - through cross border acquisitions
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and organic growth in other
low-cost locations
• Global majors continuing to significantly
ramp-up their offshore delivery capabilities -
predominantly in India
• Portfolio of services sourced globally
continued to expand into
• Transition from outsourcing to global sourcing
to drive the next phase of evolution in process
quality frameworks and practices
• Having aligned their internal processes
and practices to international standards such
as ISO, CMM, Six Sigma, etc., companies in India
are seeking to further increase the quality and
productivity benchmarks by introducing adaptations
more suitable for remote service delivery
» Going forward:
For India to fully capitalize on the opportunity
and sustain a disproportionate lead in the global
IT-ITES space, we need to focus on five key areas:
• Enhancing the talent
pool advantage - focus on skill development to
better leverage the worlds largest working population
• Strengthening urban infrastructure in existing
(tier I) and emerging (tier II and tier III) cities
and continued emphasis on proactive regulatory
reform to facilitate greater ease of doing business
• Driving a philosophy of operational excellence
amongst industry players (across the board) to
ensure that India based delivery sustains world-leading
benchmarks in performance
• Catalyzing domestic market development
• Actively promoting an uncompromised agenda
towards global free trade
Source: NASSCOM
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NASSCOM Announces Winners of Global
Leadership Awards 2006
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| Leaders from across the
world were honoured at the Forum for their creativity,
leadership, innovation and vision in IT to meet business
and strategic goals NASSCOM, the premier trade body and
'voice' of the IT software and service industry in India,
announced the winners of Global Leadership Awards on the
eve of its annual summit NASSCOM 2006: India Leadership
Forum. |
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The
Global Leadership Awards, in its second year now seeks
to applaud the mega corporations and individuals that
have transformed, not just the international business
scenario, but also impacted the Indian economy and contributed
to its growth.
"Today the Indian IT sector at $36 billion is at
the threshold of its next big leap-globalization. As we
explore new horizons and explore new frontiers, we are
also continuously raising the bar to measure performance
and excellence. The Indian IT industry is beginning to
increasingly look beyond Indian shores at technology success
stories that are re-defining the global markets, at organizations
and the individuals who are at the helm of the
technology revolution and contributing to its overall
momentum, said Mr. Kiran Karnik, President NASSCOM.
"In an attempt to laud some of the pioneering works
done in the IT space, NASSCOM has instituted its Global
Leadership Awards. We are proud to present the awards
to individuals across the globe who have contributed significantly
to the advance of technology for the benefit of business
and society." he added.
Recipients of the NASSCOM Global Leadership Awards 2006
are:
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Business Leadership Award
- Ben Verwaayen, Chief
Executive Officer, British Telecom, UK for his tremendous
business drive in leading the organization and set industry
benchmarks in the areas of profitability, ethics/governance,
best practices and people-friendly strategies to build
a sound workplace.
Innovation Award
- Meg Whitman, President
and CEO, eBay, US for using technology in an exemplary
fashion, that has enabled millions of people to enjoy
the power of the Internet and conduct commercial transactions
from the comfort of their desktops.
IT User Award -
ABN Amro for rolling out strong IT strategies, that
have enabled its employees to keep abreast of state-of-the-art
IT platforms and harness their power to improve personal
productivity and performance within the organization.
ABN AMRO's visionary strategy to invest extensively
in IT and use it optimally has resulted in making it
a high productivity, efficient and customer intimate
bank.
Thought Leader Award
- Thomas L Friedman, Columnist,
The New York Times for shaping global opinion and delighting
millions of readers with insightful columns on foreign
affairs. A thought leader in his own league,
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Thomas L Friedman
has brought balance and perspective to sensitive issues
such as outsourcing.
Global Indian Award -
In addition to the four usual categories of the Global
Leadership Awards, this year NASSCOM will also confer
the Global Indian Award to Promod Haque, Managing Partner,
Norwest Ventures Partners. His path breaking innovations
and investments especially in the IT sector, have fueled
the spirit of entrepreneurship in India and around the
globe. The award is being presented to him to recognize
his contribution in strengthening India-US linkages
by identifying high potential business ideas and converting
them into viable and successful partnerships
Unlike last year when the awards were introduced to
bring into the spotlight organizations and individuals
that were creating business value for their customers,this
time focus has been extended to include the entire eco
system that supports innovation and the growth of the
global ICT sector. One of the key highlights at NASSCOM
2006, the Global Leadership Awards were presented to
winners in a ceremony on February 16 as a tribute to
their commitment, which has lead their organizations
to achieve higher goals and establish them as business
leaders in the competitive global environment.
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