India’s IT Sector

The Indian Express has some statistics about what to expect in the coming year. [USD 1 billion = Rs 4,400 crore]

Indias domestic IT industry is expected to record a growth of around 11 per cent in 2003-04, touching a revenue of Rs 33,700 crore, according to Nasscom.

Domestic IT industry has three segments software and services, hardware, peripherals and networking, and training. Software services exports are expected to grow to Rs 55,510 crore in 2003-04.

The software and services segment is expected to touch revenues of Rs 15,400 crore in 2003-04, up from Rs 13,400 crore in 2002-03, a growth of 14.8 pc, which is lower than the 23 per cent growth witnessed by the segment in 2002-03.

Hardware, networking and peripherals segment is expected to register a growth of eight per cent to reach a revenue Rs 17,200 crore in 2003-04; training segment is likely to recover in 2003-04 with revenues increasing six per cent to Rs 1200 crore, Nasscom said.

The software and services segment can be further divided into packaged software and software services.

The packaged software segment ERP, SCM, CRM and E-commerce is estimated to grow five per cent to reach Rs 2100 crore in 2003-04 from Rs 2000 crore in 2002-03.

The services segment customised software services, turnkey projects and consulting and other services is estimated to grow 18 per cent from Rs 8500 crore in 2002-03 to Rs 10,000 crore in 2003-04.

Meanwhile, small and medium enterprises have shown a significant increase in the usage of information technology with about 81 per cent of them having their own websites in 2003-04 as against 73 pc in the previous year.

According to a snap poll conducted by CII, all the respondents were availing it facilities in their organisation with 17 per cent of them describing the IT penetration as excellent compared to 12 pc in 2002-03. Last year, 19 pc of the respondents had described this phenomenon as marginal which has come down by six per cent this year, a CII release said.

Further, all the respondents have indicated an increase in their turnover due to the use of IT. While 55 pc of those polled indicated an increase of up to five pc in their turnover, 37 pc claimed a rise between 5-25 pc.

According to the survey, there has also been an increase in the annual expenditure on it by SMEs. On an average, 64 pc of the respondents spend up to five per cent of their turnover in it hardware, software and manpower.

Regarding the returns on investments on their websites, 46 pc of the organisations claimed they were satisfied while 12 pc said they had realised more than their expectations. The CII-SME survey is fourth in the series of surveys undertaken by the CII Small Industry Desk during 2003-04.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.