Software Services in India

India’s software services industry is one of the world’s most successful information technology industries. Begun in 1974, it employed 345,000 persons and by the end of 2004 had earned revenue worth $12.2 billion, equal to 3.3% of global software services spending.

According to a recent study by Forrester, India will continue to grow its software industry in scale, scope, and value added and it’s edge over other competing nations in the area of software development and IT outsourcing business comes from the country’s decade old experience in this area, fluency in the English language, supportive government policy infrastructure and high quality offerings.

India has also become the most widely accepted destination not only for software outsourcing, but also for outsourcing of several other types like business and knowledge etc. A recent study has found out that more than 40 percent of software development and other types of services are being outsourced to India. In other words, India is the most preferred country for outsourcing of any kind.

The primary focus of the Indian software industry has been export – sometimes in corporation with foreign companies who are established in India as a subsidiary. The main reason for the foreign companies to establish themselves in India is still the low cost of labor coupled with a highly educated workforce. The Indian IT/software service industry spans from huge world-renowned Indian companies like Infosys,Tata Consulting Services (TCS), Wipro etc. who are almost in the same league as international companies such as IBM, Sun Microsystems, Oracle, Microsoft, Dell etc. who are also present in India, to a host of small startups.

Talking of the India's software development and services industry its exports were estimated to grow by 32.6 percent to over $31 billion in the current fiscal year to March 31, according to data released by the National Association of Software and Service Companies (Nasscom).

IT services including software development were expected to contribute $18 billion to exports in the current year to March 31, while business process outsourcing (BPO) and call centers are likely to contribute another $8.3 billion, according to Nasscom in Delhi. Engineering services, research and development (R&D) services, and product development work are expected to contribute a further $5.0 billion.