BRIC service sector to generate profits: KPMG

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: The recent business outlook survey on Bric economies brought out by KPMG/NTC Economics Ltd is upbeat about the economies of the four countries, namely Brazil, Russia, India and China. In fact, Bric service providers expect continued strong growth of activity over the coming year, according to the survey, whose salient points are: service sector companies remain extremely confident regarding overall business conditions; companies expect to maintain strong growth of activity, new business, revenues and profits; higher revenues and profits are expected to support robust growth of investment in capital; service-sector jobs are set to be created at a marked pace across the BRIC countries and companies anticipate substantial growth of outsourcing. The service providers in these countries continue to remain confident over business prospects in the next 12 months. Positive sentiment was most widespread amongst Indian firms. Service providers are confident that revenues will rise over the coming year, with 61% predicting an increase. Higher new orders, improving market conditions and the introduction of new products were cited as the main factors likely to support growth of revenues.

Volume of new business placed with Bric service providers are expected to rise at a marked pace over the coming year. Growth of new work is anticipated at 58% of companies, while less than 3% forecast a fall. According to a FICCI report, in the past decade, India with its expertise in software and IT-enabled services (ITeS), has emerged as a leading global services sourcing hub.

The Indian IT market pegged at $20 billion accounted for 3.82% of the GDP in 2003-04. Software and service exports from India in 2003-04 totalled $12.5 billion, according to Nasscom and well on its way to earning $50 billion in exports by end 2008.