Nasscom Sees Double-digit Growth for IT Industry

by Manu Sharma    Dec 09, 2009

Just as the effects of the downturn are slowly beginning to diminish, the Indian IT industry is likely to witness a double-digit growth during the next fiscal 2010-11, Nasscom President Som Mittal said.

 The Indian IT industry has shown a 4-7% growth during the second quarter of this fiscal.

Speaking to CXOtoday at the Nasscom Diversity and Inclusivity Summit 2009, Bangalore, Som Mittal, president of the National Association of Software and Services Companies (Nasscom) said, "The country is witnessing changes in the positive direction and despite having witnessed a flat growth during Q1 of this fiscal, Q2 has seen a 4-7% growth for most IT companies."

However, the industry is unlikely to attain the huge growth rate it had recorded till 2007, he said.

Mittal said banking and financial services (BFSI), a sector that was hit hard globally, is doing remarkably well in India. In fact, it contributes to 40% of the business and has more potential for growth. Besides healthcare, utilities and climate change are the other verticals that IT companies are betting on.

For fiscal 2009-10, Nasscom had projected 4-7% growth. Earlier in June, the industry body revised the growth figure from the earlier projection of 15-18%. The global meltdown had hugely impacted the IT and the BPO industry with customers cutting down on their IT spending.

The growth rate of around 30% achieved for an entire decade is very hard to maintain, said Mittal, but in the next decade it will get bigger at a compounded annual growth rate of about 14% — it is estimated to jump from the $50 billion in 2008 to around $225 billion.

Some of the big IT companies like Infosys, TCS, and Wipro are recruiting local talent and during the 8th semester will start employing freshers.

Recently, some of the top IT companies such as Accenture have announced that they will raise their staff strength by 8,000 in 2010, mainly in the analytics department. Similarly, Infosys BPO, the back-office wing of Infosys, said it will hire nearly 2,000 people by the end of this fiscal.