The Indian IT industry has grown phenomenally over the past decade ? from a $10-billion industry in 2001 to $60 billion in 2010. The journey of the Indian Industry has been one of great interest for many and serves as an inspiration for many countries who aspire to develop their IT industry to emulate that of India. There have been a number of reasons for the tremendous growth of the Indian IT industry, one of them course being the perceived threat from the Y2K Bug which had thousands of Indian IT professionals correcting millions of lines of code over 1996-1999, and the eventual smooth transition from 1999 to 2000 that established India?s credibility as an IT and ITeS destination. This set the tone for the industry and ever since then, there has been no looking back. The rise of Nasscom as an organisation that consolidated voices across the industry and presented the areas of concern to the government through the decade was one of the more significant developments. Nasscom has through the decade influenced key policy with regard to the IT industry such as the STPI scheme and the SEZ policy, and more recently, been a key representative for the Indian IT industry at various international forums, raising concerns on protectionism when required.
In comparison to other economies like China, India?s highly skilled English speaking workforce provided great impetus to the growth of the Indian IT industry. The availability of a technical workforce and favourable business environment provided a gateway for several global IT players who decided to set up shop in India in the late 90?s to leverage the opportunities presented by the country and ultimately serving as a testimony of India?s true IT capabilities.
Apart from a robust education system in the country that churns out over 600,000 engineering graduates each year; the Indian IT companies assembled highly effective employee education programmes that conditioned high calibre employees to work with global clients. Over the years, the industry also diversified from its expertise in IT services, to provide consulting, BPO, product and engineering services as well, catering to the changing needs of global clients in a dynamic business environment. From operational work in the beginning of the decade Indian IT services companies are now proactively partnering clients on their transformational and innovation led projects. The IT industry has contributed significantly to the growth of the Indian economy, especially in the past decade by generating employment across the IT sector as well as several ancillary industries. IT also contributed to the rise of Tier II cities such as Mangalore, Mysore, Chandigarh, Jaipur, Bhubaneswar, Thiruvananthapuram, Coimbatore to name a few. While increasing globalisation helped Indian IT companies to gear up and offer the same services as their global counterparts at competitive prices, the Indian IT industry was also quick to realise the need to follow high standards of corporate governance and transparency, which was essential in gaining the confidence of international customers.
The decade also saw the Indian IT industry?s resilience as it survived two downturns ? first bursting of the internet bubble in 2001 and in 2007, the worst global economic recession since the Great Depression of the 1930s.
Though the growth of the industry was impacted as its primary markets plunged into recession, there was a quick shift in strategy with a renewed focus on diversifying the geographical and vertical mix. These turbulent periods served as a reality check for the industry and enabled us to do more with less for clients.
As we continue to live in interesting times, it is important to note that factors that had accelerated the growth of the Indian IT industry at the beginning of the decade are now posing as challenges. Countries like UK and US, which have been primary markets for the industry, having opened doors at the beginning of the decade for Indian software professionals and companies by relaxing visa norms are now becoming more stringent and capping the number of HIB visas that can issued. In the wake of this rising protectionist sentiment, the industry as a whole has been working together to explore different models to cater to their global clients in a seamless fashion.
Developing and retaining quality talent is another challenge faced by the industry today. Though the number of engineering colleges across the country has increased in the last decade, the industry faces a war for talent which it is trying to address through industry and academia partnerships and investing heavily in continuous learning programs for their employees.
This past year, the industry has once again witnessed a revival in growth from traditional verticals like manufacturing, banking, insurance but in the near future the growth of IT and IT enabled services will be fuelled by business imperatives like mobility, climate change, healthcare, energy efficiency and sustainable energy. As growth continues to come back to the industry: the focus will remain on evolving new models of engaging customers and helping them to transform themselves into enterprises of tomorrow.