Home market beckons infotech industry
As the new year dawns, it might make sense for India’s IT companies to take a spiritual advice and apply it to their material sphere.business Updated: Jan 04, 2010 17:48 IST
As the new year dawns, it might make sense for India’s IT companies to take a spiritual advice and apply it to their material sphere. They need to look within.
There was a time in the 1980s, when export was such a buzzword in the Indian economy, that the US dollar was like God.
That was not surprising in an inward looking economy that had for decades earlier missed the opportunities outside.
The 1990s changed all that, and we saw the emergence of export darlings such as Infosys Technologies which last year saw its first zero-growth year in its history. However, as they say, one door closes, another opens.
In fact, it turns out that it was always open.
I am talking of the domestic IT market. With more than 500 million mobile phone connections as of last month, telecom companies need a whole load of software-loaded equipment and allied services.
From small businesses to mushrooming educational institutions, everybody is using software, and entry-level computers are fast heading for the sub-Rs 10,000-mark, if not already there.
All that showed up last week when market researcher IDC’s Indian unit came out with its predictions for 2010. IDC expects the domestic market in both IT and IT-enabled services together to grow by 15 per cent from an estimated Rs.104,906 crore in 2009 after a slowdown year in which growth was only 5.4 per cent.
But the overall number, which also clubs hardware with other IT stuff, hides an interesting story.
The break-up reveals that India’s software market grew by 12.9 per cent to Rs. 11,454 crore during the year, IT services by 14.7 per cent to Rs 27,888 crore and IT-enabled services by a staggering 40.8 per cent to Rs 9,638 crore.
Add these up together, and we will get a rough figure of around Rs 49,000 crore — and that would be roughly $10.5 billion, equal to about one-fifth of the country’s overall IT and IT-enabled services exports.
The telecom boom is giving rise to domestic call centres, serving the industry itself, and also other industries that can use the telecom infrastructure to drive services (even if some of them involve the tele-calling pests that we loathe!).
All that is that’s good news for the IT industry after a year that saw the darling US market melting down. Looking within is a good idea all over again.