NASSCOM Expects IT Industry To Grow 8-9% This Year
“The IT industry is at an inflection point,” said NASSCOM President, Chandrashekhar.
Software services providers’ lobby group expects the industry to grow at last year’s pace even as India’s largest export faces challenges from automation and visa curbs in the U.S.
Exports are estimated to grow 7-8 percent in the year ending March 2018, R Chandrasekhar, president of the National Association of Software and Services Companies (NASSCOM), said in a press conference in Hyderabad. The domestic revenue is estimated to grow 10-11 percent, he said.
While NASSCOM did not give forecasts for the overall industry growth, chairman Raman Roy told BloombergQuint that it works out to around 8-9 percent. That compares with an 8.6 percent rise in the previous financial year.
Single-digit revenue forecasts may be the new normal for India’s information technology sector, Parag Gupta, India internet, IT and media analyst at Morgan Stanley, recently told BloombergQuint. Automation and artificial intelligence have become mainstream and all these services are trying to create a higher revenue per employee. Amid regulatory pressure and visa curbs in the U.S, larger Indian companies are also talking about creating more job opportunities on-site.
The IT industry added $11 billion in revenue in the year ended March in constant currency terms, meeting its guidance of 8-10 percent, Chandrashekhar said. Digital business contributed significantly to the growth, with revenues jumping four-fold in the last seven years.
Digital business contributed significantly to the growth, with revenues jumping four-fold in the last seven years.
The question was that advent of digital would mark the decline of Indian IT, but the data shows that digital is triggering a new sunrise.R Chandrasekhar, President, NASSCOM
The NSE Nifty IT Index pared gains after NASSCOM’s announcement. The index, which had risen as much as 1.28 percent to 10,354 in the morning, dropped to 10,291 as of 1:00 p.m.
The industry association had delayed offering its annual guidance in February, citing "prevailing uncertainties" especially in terms of firms’ discretionary budgets.
The IT sector has been facing headwinds in the U.S., where lawmakers are reforming the H-1B visas programme, which most Indian firms rely on to send workers abroad. The Donald Trump administration’s focus on creating jobs in the U.S. has also forced firms to expand local hiring.