IT growth will dip this fiscal, warns Nasscom

Tech body sees competition from neighbouring countries as spoiling the much vaunted IT party

CHENNAI: The Indian IT industry, which has been clocking an impressive growth rate in recent years, is likely to see a slowdown in this fiscal year due to competition from China, Philippines and Sri Lanka, industry body Nasscom said.
    In fact, according to Nasscom president Som Mittal, the much vaunted sector's growth rate might come down by as much as 6 per cent due to the competition, in addition to other factors like economic uncertainty and lesser IT spends by the US.
    "A recent survey by Nasscom has revealed that the industry grew by 28-29 per cent in the last few years. But our forecast is that it will go down to 22-24 per cent," Mittal said.
'ON TRACK FOR $60-BN TARGET'
However, a latest survey by Nasscom made it clear that the growing competition would not have any impact on the long-term prospects of the sector which is set to cross the $60-billion mark this year.
    Titled 'FY08 revenue performance and FY09 forecast for the Indian IT software and services sector', the survey said that the Indian IT-BPO industry – including domestic companies –recorded an overall growth of 28 per cent, clocking revenues of $52 billion in 2007-08, up from $39.6 billion in 2006-07.
    Within the export segment, IT services exports grew by 28 per cent to clock revenues of $23.1 billion, while BPO exports were up by 30 per cent registering revenues of $10.9 billion. Engineering services and products exports clocked revenues of about $6.4 billion, growing at 29 per cent in 2007-08.
'REQUIRE NEW BIZ MODELS'
Releasing the survey here, even Mittal said that the industry's resilience is reflected in its FY07-08 performance.
    "The industry is now focusing on improving productivity, efficiency, as well as opening up new markets and services. The next decade offers opportunities and challenges, which will require new business models.... Nasscom is developing a long-term vision for 2020, to chart out the roadmap for all stakeholders and help them tap into this opportunity," he said.
    Meanwhile, according to Nasscom's findings, the top ten IT software and service exporters during 2007-08 were Tata Consultancy Services, Infosys Technologies, Wipro Technologies, Satyam Computer Services, HCL Technologies, Tech Mahindra, Patni Computer System, I-Flex Solutions, Mphasis (an EDS company) and Larsen & Toubro Infotech.
    Nasscom did not include some companies whose corporate headquarters are located outside India, but have significant Indiacentric delivery capabilities, and have not shared their India-centric revenue figures.
    Had they been ranked based on their India revenues, companies such as Accenture, Cognizant, Hewlett-Packard and IBM would have also appeared in the rankings. AGENCIES