IT SECTOR OVERVIEW
Statistics, news & updates: everything you need to know about the IT Industry in India
Summary/Snapshot
The IT-BPM industry now accounts for 7.5% of India’s GDP. The industry employs 5.4 million people, making it the largest employer in the private sector.
India continues to have the world’s second-largest number of telephone connections, with 1.199 billion subscribers as of March 2024.
In the Global Innovation Index 2024, India is ranked 40th out of 133 countries.
IT hardware output is expected to reach ₹3 trillion by 2026, with domestic value addition rising from 5-10% to 20-25% over the next five years
India ranks third among the world’s most inventive lower-middle-income economies in 2024.
In FY24, the Computer Software & Hardware sector received US$ 7.97 billion in FDI equity inflows, maintaining its position as a top sector.
The government allocated ₹8,029.01 crore (approximately US$ 1 billion) to the Ministry of Science and Technology in the Budget 2024-25.
In 2024, the Indian data center industry is expected to receive about US$ 1.2 billion in investment5. By 2025, per capita data consumption is projected to reach 25GB per month.
Growth Drivers
Production-linked incentives for IT Hardware were approved in 2021 to stimulate local manufacturing.
In the IT and BPM sectors, India permits up to 100% Foreign Direct Investment (FDI) under the automatic method.
Consumer acceptance of technology and telecom, and targeted government measures, are driving increased adoption of information and communication technology.
The Bharat Net Project aims to integrate at least five Wi-Fi access sites in each of the country’s 250,000 villages.
Sub industries
- Information Technology
Opportunities
According to the Department of Science and Technology, at the BRICS S&T Steering Committee’s 12th meeting, all countries agreed to an STI-led BRICS Innovation Cooperation Action Plan (2021-24) suggested by India.
India is the world’s leading supplier of IT products, has the world’s third-largest pharmaceutical industry, and a rapidly expanding contract research sector.
Challenges
- Cyber security threats is one of the major challenge faced by the IT sector, in the last four years there have been more than a 50% increase in data breaches
- Other countries’ new data protection and privacy standards are blocking Indian enterprises from serving in those countries. The GDPR (General Data Protection Regulation) of the European Union, for example, went into force in May 2018. Because not all Indian IT firms can comply with GDPR and other data privacy regulations, many have had to stop serving EU clients.
- One of the most difficult difficulties facing the IT business is employee retention.
How we can help you:
– Product-Pricing analysis– Strategies for – product/service localization
– Market research to sell effectively
Key Investment Opportunities
- IT services, BPM, software product companies, and shared service centers are all being established.
- Knowledge services, data analytics, legal services, Business Process as a Service (BPaaS), and cloud-based services are fast-growing sectors within the BPM domain.
- IT Services and fast-growing industries within it, such as SMAC (Social, Mobile, Analytics, Cloud) products and services, IT consulting, and software testing.
- The fastest expanding sectors in engineering and R&D are telecom and semiconductors.
Recent Developments
- Significant developments in the nuclear energy sector are likely as India looks to expand its nuclear capacity. Moreover, nanotechnology is expected to transform India’s pharmaceutical industry. The agriculture sector is also likely to undergo a major revamp with the government investing heavily for a technology-driven green revolution.
- To accelerate digital innovation in India, NITI Aayog, Amazon Web Services and Intel have come together to develop a new experience studio to boost problem-solving and innovation between government stakeholders, start-ups, enterprises and industry experts. The new experience studio will use technologies such as artificial intelligence, machine learning, Internet of Things, augmented reality, virtual reality, blockchain and robotics to accelerate their use in the public sector.
Key Players in India
- Tata Consultancy Services
- Infosys Technologies Limited
- Wipro Technologies
- HCL Technologies
- Redington (India) Ltd
- Tech Mahindra
- L&T Infotech
- MphasiS Ltd
- Mindtree Ltd
- Oracle Financial Services Software Ltd (OFSSL)
- Microsoft
- HP
- IBM
- Accenture
- Oracle
- SAP
- Capgemini
- Cognizant
- Infosys
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