NEW DELHI, September 26 — India’s outsourced software and IT services industry grew 9.5 percent to reach $239 billion, according to industry estimates reported on Friday, a figure that keeps the country the world’s leading destination for IT outsourcing even as global economic uncertainty weighs on technology budgets. The growth rate outpaces the IT spending increases of many developed economies, the report noted, reflecting continued demand for digital solutions.
The $239 billion total likely encompasses IT services and business process management exports, though the report did not specify an exact breakdown.
A sector built since 1991
The industry, represented by the National Association of Software and Service Companies (NASSCOM), has been a cornerstone of India’s economy since the liberalization reforms of 1991 opened the door to foreign investment and offshoring. Its rise accelerated in the 1990s and 2000s, fueled by Y2K preparation work and the dot-com boom. Key players include Tata Consultancy Services (TCS), Infosys, Wipro, and HCL Technologies, all founded between the late 1960s and early 1980s.
Their chief executives are K Krithivasan at TCS, Salil Parekh at Infosys, and Thierry Delaporte at Wipro, though their specific comments were not part of the report. Major global corporations rely on Indian firms for software development, customer support, and back-office operations.
The sector employs millions of engineers and professionals, making it a vital source of employment and foreign exchange for India.
Challenges and the road ahead
Challenges persist. The report cited rising protectionism, automation, and competition from other low-cost countries. The report did not provide details on hiring or revenue segmentation.
The milestone comes as global companies increasingly integrate artificial intelligence and cloud computing, areas where Indian firms are investing. Government initiatives like Digital India and Make in India have also supported the ecosystem, according to the report.
The sector’s evolution from low-cost back-office services to high-value consulting and digital transformation reflects its maturity. The reported 9.5 percent growth, the report said, is a testament to its adaptability. What to watch next: whether the industry can hold its growth rate as protectionism and automation reshape global sourcing decisions, and how the AI and cloud investments by Indian firms translate into future revenue.
