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IT sector maintains tempo

The Information Technology sector appears set to become a $50 billion industry this year, and is on course to achieve the export target of $60 billion by 2010. The National Association of Software and Services Companies (Nasscom) has reported an over 30 per cent growth in the last fiscal, surpassing expectations once again. It has projected a 24 to 27 per cent growth in revenues for the current year. Last year’s performance was not unexpected, though the fears of a s lowdown in the U.S. economy and market were expected to dampen growth in the sector. As a result of the sustained high growth, the IT industry claims to be the country’s largest job creator in the private sector, providing direct employment to 1.6 million people and indirect employment to six million people. Over the past couple of years, most of the IT and IT Enabled Services companies have been feverishly recruiting a bulk of the engineers passing out of the colleges in different parts of the country. Additional training to bridge critical gaps in such areas as communication, team work, and industrial organisation has become an essential part of the orientation programmes.

Looking at the performance figures for 2006-07, it becomes obvious that the IT sector still remains largely export-driven. Of the $39.6 billion revenue raised last year, $31.4 billion came from exports, the share of the domestic market being just $8.2 billion. The domestic segment has reported a 23 per cent growth, but this has been on a very low base, leaving a wide scope for substantial improvement in performance. It is imperative for the rest of Indian industry to utilise the IT skills and applications available within the country to equip itself for international competition. When so many foreign companies are outsourcing their IT requirements to Indian companies and using software developed in India to upgrade their products and capabilities, Indian companies cannot ignore the competitive edge that these solutions offer. Perhaps, the IT companies must also come up with special packages to make their software solutions attractive to domestic industry. It is time the IT sector looked inward and addressed basic issues such as growing attrition rates in the industry, the impact of its working hours on the staff, the broader community welfare, and the longer-term welfare of the employees.

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