Software industry association Nasscom expects growth momentum to continue for India's IT players over the next decade as the sector will be backed by new growth drivers such as small and medium businesses and government.
Nasscom feels IT players are already restructuring their business models, as they can shrug aside concerns emanating in a fast changing world, to meet customers demands.
"The addressable market is set to triple in size to touch $1.5 to $1.6 trillion in 2010 from the present $500 billion and a large part of these new opportunities will come from SMB (small and medium businesses) segment and increased government spending," said Som Mittal, president Nasscom on the eve of the Nasscom Leadership Forum 2011. The estimated $1.5 to $1.6 trillion addressable market is roughly over one and half times the size of India's GDP.
Mittal said 80% of this growth will be driven by opportunities outside the current core markets. In the current fiscal, total revenues of the IT sector will be $76 billion (R3,40,000 crore)
Traditionally, software companies have relied upon US and UK as their traditional regions providing quality software solutions at lower price for banking, financial and insurance companies. During the economic slowdown when companies cut their IT spending and later on when newer technologies such as Cloud —which offers software services over the internet — gained momentum, concerns were raised over long-term revenue growth. However, Nasscom feels these are opportunities.
"A large number of smaller businesses can avail IT facilities taking the Cloud advantage that makes them potential customers. Also IT spend for governments across the world is set to increase as they rely on automation to cut overall costs," said Mittal. He said the Egypt crisis will not have much impact on the sector as Middle East's revenue contribution has been minuscule for IT players.
(Nasscom paid for the correspondent's travel and stay)