The IT and BPM industry in India is a major source of revenue and employment.
Even as the Indian economy is hit by a prolonged slowdown, the IT and BPM industry may provide cushion to achieve the optimistic growth figures presented by the government. IT and BPM industry in India is a major source of revenue and employment, and the industry is further expected to grow at 8.4 per cent in the current fiscal on a constant currency basis to USD 192 billion. Last week, the industry body Nasscom said that the industry continues to remain “cautiously optimistic” about the future. Nasscom is the trade body that consists of over 2800 members representing the USD 180 billion Indian IT & BPM industry.
The IT and BPM industry contributes to 7.9 percent of India’s GDP and employs around 41 lakh professionals. There are a total of 31,922 registered Information Technology (IT) companies functioning in the country, with Delhi and Maharashtra having the maximum number of IT firms, said Sanjay Dhotre, MoS, Ministry of Electronics and Information Technology in Lok Sabha in December 2019.
“To create employment opportunities and dispersal of IT/ITES industry in small cities and towns, Government had launched India BPO Promotion Scheme (IBPS) to incentivize setting up of 48,300 seats BPO/ITES operations by providing financial support up to Rs. 1 lakh per seat,” said Ravi Shankar Prasad, Minister for Electronics and Information Technology in Lok Sabha in December 2019.
The financial support will be in the form of viability gap funding for capital and operational expenditure along with special incentives like encouraging employment to women and physically disabled persons, promoting local entrepreneurs, etc, he added.
The direct employment generation under IBPS is over 32,000. By the end of the last fiscal, the direct employment generated under IBPS was 25,357 of which nearly 15,000 was generated in FY19, going by the data provided in the Lower House.
Meanwhile, issues such as geopolitical, technological or the overall uncertainty, can potentially bring the growth of the industry to slow down, if not adapted to change rapidly. “Cautious optimism could just be a politically correct term to describe an incrementalist stance. This is the time to invest sharply and decisively to be an active participant in redefining space,” Ajay Gupta, Lead Partner – Digital Transformation at Kearney. Unless there is acceptance of the quantum of change needed, the industry might suffer more than being factored in the worst-case scenarios and there will be no one to blame but their own inability to not rewrite the script, Ajay Gupta added.