Indian IT Industry Economic Diplomacy Division Ministry of External - PowerPoint PPT Presentation

Indian IT Industry Economic Diplomacy Division Ministry of External Affairs New Delhi

Source: N dia: A matchless IT business partner MARKET: T: Most st Attractive BUSIN INESS INFRASTR TRUCTU CTURE- Excellence in delivery Growing spending power – Entry level wages – Lesser ~7-8X ~1.2 billion LEADING GLOBAL SOURCIN CING amongst the biggest market compared to source nations NATIO TION Number of Global Delivery >75% Population with <35 years of age >670 Centers (GDCs) > 78 Wider online user base; 29% Diverse supplier landscape; 375 million +16000 growth in internet users >8000 digital-centric INNOVATOR- Taking the lead in driving growt wth for SKIL ILLS – Digital hub cust stomers 67% Start-ups innovating for futuristic Talent composition – 2x growth >4,200 6.2 million Global sourcing share technology areas in 5 years Growth in funding in B2B space Digitally skilled people employed 250% ~250,000 over the last year in India Collaboration between large & Technical output – Engineers ~50 > 1 million small providers annually

Growth th of India’s IT Sector or 2005-P -Prese sent Firms in India became MNC 2000-0 -05 with delivery centers ac the globe. 1995-2 -2000 The number of firms in India India’s IT sector is at an grew in size and started inflection point, moving f offering complex services such enterprise servicing to as product management and Pre-1 -1995 It Industry started to mature. enterprise solutions. go-to-market strategies. Increased investment in R&D The country has already Western firms set up a number and infrastructure. become the third largest early 1990s, US-based of captives in India up base India increasingly seen as a panies began to outsource product development k to low-cost and skilled destination nt pool in India

1980-1990 990 1990-2000 000 2000-2010 010 2010 onward rd Revenue 1 >8 ~78 1 (US$ Bn) IT Contribution to India Employees 0.06 0.34 2.3 3.7 (Million) <1,000 ~ 2,000 10,000 – 12,000 >16,000 00 No. of Firms ~1% 1.8% 6.1% 9.3% GDP Share Share in Service <5% 10.5% 26% >45% Exports Share in Global - 47% 67% - Sourcing Bimodal IT, Dig Low-end support & End-to-end services; Bus, Automat development,Time & Strategic partner; - Value Addition platforms, IoT, s Material pricing (non-linear growth); tech, innovati Pay-as-you-use n for 2000, India IT Enabli ling Sma Cost Arbitra rage Colla labora ration Value Addition 2016 associated with Enterprises

STATE OF PLAY  The Indian IT and ITeS industry is divided int major segments – IT services, Business Process Management (BPM), software products & ia is fast emerging as a digital engineering services, and hardware. nomy…Digital India, Make in  IT Services: ia, Skilling India are creating a  Market Size: USD75 Bn ewed thrust on the domestic  >81% of revenue comes from Exports rket.  Banking, Financial Services & Insurance ian IT companies can offer (BFSI) is the major vertical. tions in the following segments:  BPM: Social Mobile Analytics & Cloud   Market size: USD28 Bn (SMAC),  87% of revenue comes from Exports ERP, CRM, mobility and user   Market size - USD54 billion by 2025 experience technologies.  Software re Products & Engineering Services: Business Process Management   Market size: USD27 billion sector, which is being driven  >84% of revenue comes from Exports India2016: Indian IT Industry clocked by greater automation,  Hard rdware re: revenues of USD 146 billion…Exports expanding omni-channel  Market size: USD13.3 billion segment USD 98.5 Billion…Domestic presence, application of  Domestic market accounts for a significan market grew by 14%- fuelled by analytics across entire value share. ecommerce chain.

 Industry revenues (excluding e-Commerce) total at USD 143 Bn ian IT-BPM industry growth reflects variable impact of currency. BPM revenue break-up 1  Exports cross USD 100 Bn; doubled over last 6 years USD billion ion  IT services ~USD 75 Bn 143 132 13 119 13 35  India has become the global hub for high value added service 34 22 12 21 ER&D and Product Development revenues ~USD 26 Bn. 32 20  World’s biggest BPM destination- Revenues of USD 28 Bn. 108  ~USD 17 Bn E-Commerce industry, growing at 20% boosting d 98 87 consumption. 17 14 11  Increased consumer adoption of digital tech couple led with a technolo logy focused Government growth agenda FY2015 FY2016E FY2014 • Aadhar (Unique Identification Number) enrolment crossing 1 B Exports Domestic e-Comm Hardware • Large projects like Goods & Services Tax Network (GSTN) aw COM has begun to report eCommerce market as part of domestic • Electronic transactions related to eGov doubled in 2015 – 7 b ; historical numbers have been changed to reflect addition of this nt

ervices: At par with industry growth rate - 10.3%; PM: Scale and maturity, the industry USP IT services exports: s: Biggest st segment of the indust stry BPM exports: s: Knowl wledge services driving growt wth FY2016E: 100%= USD 61 billion High-end CIS 1% services; 12% 1% 13% F&A 2% Others; 13% 40% Knowledge services HRO 21% Software testing; 8% Procurement & logistics IS 22% Other horizontals CADM; 47% outsourcing; 20% orld’s largest IT services base - >7,500 firms 7% share in global IT sourcing • Y-o-Y growth of nearly 9 per cent S outsourcing: Fastest growing (>12%) • 38% global sourcing share oftware testing: >11.5% growth; increased focus on quality, digital • Investments in platform-based solutions, digital marketing services, ransformation driving growth analytics and consulting fundamentally changing industry landscape 50+ MNC and GIC firms

dian IT-BPM: Mix of players IT-BP BPM Industry Structure, FY 2016 Fully integrated players offering complete range of services • Large scale operations and infrastructure • 11 Large >40% Presence in over 60 countries • players Mid-tier Indian & MNC firms offering services in multiple • verticals Mid-sized ~35-40%c 40%cent Dedicated captive centers • 120-150 players Near shore and offshore presence in more than 30-35 countries • Players offering niche IT-BPM services • Emerg rging players Dedicated captives offering niche services ~10-11% 11% • ~1,000 000-1,20 ,200 Expanding focus towards sub Fortune 500/1,000 firms • Small players focusing on specific niches in either services or • Small sized verticals ~9-10% 0% ~15,00 ,000 players Includes Indian providers and small niche captives • Start-ups emerg rging as the partners of the future re rce: NASSCOM

India IT: Business Destinations & Emerging verticals Traditional geogra raphies growing fastest – 10.4% Emerg rging verticals growing faster BFSI RoW; 2% APAC; 8% Hi-tech/ Telecom 3%3% 4% Continental 5% Europe; 11% Manufacturing 10% 41% Retail Healthcare 16% Travel & UK; 17% Transportation Construction & USA; 62% 18% Utilities FY2016E, 100%= USD 108 billion ardware exports SSCOM

stry hiring levels steady; specialized • Industry employee base reaches 3.7 million, addition of l sets in demand lakh in FY2016 Direct employment * • eCommerce industry - 40,000 employees 3,690 (‘000) 3,490 • 1.1 million jobs added in last 5 years 6% • Annual talent output: 6.2 million 760 • >1 million technical graduate pool 720 • ~36-38 per cent share of global employable talent 1,090 pool for IT 1,040 • Indian IT industry a Global talent powerhouse – representative of millennials, showcasing diversity, and leadership in digital skills 1,840 1730 • Talent hunt shifting from ‘Qualification’ to ‘skill based’; hiring ‘knowledge and expertise’ FY2015 FY2016E IT exports** BPM exports IT-BPM Domestic*** ding Hardware ** includes IT services, Software products, ER&D and product development *** excludes eCommerce