The Great Indian Tech Industry Saga Continues; Aims to be $350 bn by FY26

Today India is at the Centre of global attraction and considered a knowledge powerhouse and the 21st century is earmarked as Information Technology-driven. To increase productivity, ease of doing business, and grow efficiently and economically in this competitive world IT-based services are indispensable for any organization. To prosper exponentially and to generate millions of jobs the IT industry is the backbone for our economy. Liberalisation policies such as reducing trade barriers and eliminating import duties on technology products by the Government of India and the swift advancement within the IT industry are instrumental in the evolution of this industry.

According to NASSCOM, growing by over 13%, the sector aggregated revenues of 180 billion dollars in 2019 with export revenue standing at 99 billion dollars and domestic revenue 48 US billion dollars. The Indian IT industry is blooming well at a time when the COVID-19 pandemic has grappled the whole world. In the last decade, Indian software companies have taken prominent positions in the global IT sector and India has emerged as an IT hub for the software companies of the world. After the economic reform of 1991-92, The Indian IT industry has grown rapidly with an exponential growth rate. Accounting for approximately 55 per cent of the global service sourcing market (US$ 200-250 billion) in 2019-20 the majority of global corporations are sourcing IT-ITES from the Indian IT industry. With an accelerating growth rate and expected to reach 350 billion US dollars by 2025 the revenue is further expected to grow in the coming years. IT companies are establishing their centres in tier II and tier III cities as the size of India’s digital economy is increasing which will further enhance the growth and reduce the existing disparities.

With over 1.8 million women in the workforce, the indian tech industry has also become one of the largest private-sector women employers in india with over 36 percent of women employees

Nasscom’s Strategic Review 2022
According to Nasscom’s Strategic Review, 2022 released, the Indian technology industry crossed the $200-billion revenue mark, touching $227 billion in revenue during FY22. The industry has set itself an ambitious target to touch $350 billion in revenue by FY26, growing at a rate of 11-14% with $30 billion of incremental revenue and an overall growth rate of 15.5%, its highest-ever since 2011, the report added. In driving India’s tech adoption with public digital platforms India’s massive digital infrastructure played a key role in becoming the bedrock of India’s digital advantage. The domestic revenue of the technology industry recorded a 1.2X growth over FY19 to reach about $50 billion propelled by this enhanced domestic demand.

“Fiscal 2022 has been a break through year for the Indian technology industry. We’ve posted solid, broad based growth, massively increased jobs, and are proud that we continue to be an engine for India’s economic growth, and a beacon for inclusion and diversity. We are excited about the opportunities in the Techade as we enter an era of exponential transformation and technology becomes indispensable to progress. We remain committed to catalysing the trillion-dollar digital economy with our focus on talent, technology, collaboration, and innovation," said Rekha M. Menon, chairperson, Nasscom. With over 5 million tech workers India has also emerged as a global hub for digital talent according to the report. With the highest-ever net addition of approximately 450,000 to its employee base, the industry recorded nearly 10% estimated growth in direct employees in FY22.

Shaping the future of India
With over 1.8 million women in the workforce, the Indian tech industry has also become one of the largest private sector women employers in India with over 36% of women employees. Further, growing at a CAGR of 25% with one out of three employees already digitally skilled, the digital tech talent pool is at 1.6 million. The Indian tech industry reskilled approximately 280,000 employees in FY22 with a massive focus on reskilling and upskilling. With 30-32% revenues emanating from the digital stream and over 66% of deals largely digital the Indian technology industry has emerged as a digital tech hotbed. With their primary focus as digital, the industry also undertook over 290 mergers and acquisitions (M&As).

With over 25,000 tech startups and witnessing 42 new unicorns and 11 IPOs in 2021 India, meanwhile, continues to be the third largest startup hub in the world. Total highest ever funding of $24 billion was raised in 2021 and over 2,250 tech startups were founded in 2021. With the presence of over 2,000 software product companies and 1,000 SaaS companies in India, the industry also witnessed maturity in the software products segment. In 2021 Indian SaaS based companies also secured $4.5 billion in funding. Leading to higher investment in research and development (R&D), building products and platforms innovation and partnerships across the ecosystem will accelerate digital capabilities.

With a great share of work from different parts of the world and placement of Indian experts across the globe, future belongs to India. In the education sector, Central government has initiated a transformation process. This will benefit as the job seekers will be motivated to become job creators.