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IT & ITES has been most affected by the downturn. The sector serves clients across the world and IT companies charted commendable growth in the last five years, writes Manoj Gairola.Updated: Feb 16, 2009 23:31 IST
“Recession has affected business. Some clients have shut down and others are cutting costs,” said Atul Kulshrestha, chairman of Cleave Global e-Services, a NOIDA-based mid-sized ITES company.
This is true for both small and large companies. IT & ITES has been most affected by the downturn. The sector serves clients across the world and IT companies charted commendable growth in the last five years. The sector registered annualised growth of about 30 per cent, according to NASSCOM, the industry organisation.
The total software and services revenue, including in domestic markets, was $16.7 billion on March 31, 2004. NASSCOM estimates that revenue will be $59.6 billion for the year ended March 31, 2009. The last year, however, has been bad. The performance of the top 50 companies has seen a dramatic reversal.
Companies' profits and revenues grew by 36 per cent and 37 per cent respectively over the three-year period between March 2005-08. But revenues and profits grew only 21.4 per cent and 1.6 per cent respectively for the period ended December 2008 over the same period the previous year.
The industry has created 2.2 million direct, and 8 million indirect jobs, despite the gaps in physical and social infrastructure. IT and BPO companies have also witnessed growth in the domestic market, which has grown at over 20 per cent over the last few years. Raman Roy, CMD, Quattro BPO Solutions, said that as growth has saturated the government should intervene so that the industry is at a level playing field with countries like the Philippines. “The government should give tax benefits, provide diesel at lower rates and support in transportation,” he said.
First Published: Feb 16, 2009 23:28 IST