India, no doubt, is one of the hottest destinations for IT business. With techno savvy work force, investment friendly government policies and efficient infrastructure facilities, India is all set to conquer a major share of the outsourcing revenue from global IT enterprises. According to Nasscom, the annual revenues from IT and BPO sectors are estimated to reach over US $ 76 billion in the financial year 2010-2011. This is far beyond our competitors, China with $ 35 billion and Philippines with $ 8.85 million. The report also says that Indian outsourcing industry is expected to touch a revenue return of US $ 225 billion by 2020. This, indeed, is a positive message that reflects a sustaining growth of IT industry in India.
Indian IT industry contributions immensely to the national economy. IT industry is one of the largest job creators in India. For the last 20 years, the growth of Indian IT industry is quite astonishing, as we can see clearly that the Indian market has entrenched strongly in the global IT market. No other Indian industry was more successful as to stand against its global competitors. Let us have a look on the rise of Indian IT industry and the factors that led to its success.
History of Information Technology revolution in India is associated with the outsourcing days. TATA group laid the foundation of Indian IT revolution. In 1970, TCS aligned with Burroughs Corporation (the Mainframe manufacturers), to carry out outsourced application services in Mumbai. This was the very beginning of software revolution in India. Indian IT engineers in large numbers were moved to various onsite projects (body shopping) abroad. The birth and growth of India's IT industry also added to the 1984 government policy, which provided the provision for software exports through satellite links. Although Indira Gandhi's Cabinet approved this, the Rajiv Gandhi Government announced the policy on November 19, 1984. It was in this era that various other policy initiatives including liberalization of policies for computer and electronics sector, Software Technology Parks (STP's), computerization of railways, rural digital telephone exchange etc took place. NASSCOM, a regulatory body on Indian IT services was set up in 1988 at Mumbai to assist trade and business in IT and ITES and to motivational advancement of research in software technology. Offshore outsourcing of IT services started to prevail during this period. NASSCOM's initiatives strengthened India's position as a globally recognizable brand in IT outsourcing industry. Apart from IT, other IT enabled services like hardware, peripherals, networking, training, domestic and export market for IT services, software's, and ITES-BPO started flourishing in India.
During this time, counterparts of US, UK IT firms mushroomed in key Indian locations like Mumbai, Bangalore, etc utilizing the emerging opportunities. Indian IT firms slowly moved up the value chain to provide comprehensive software development for overseas customers. Large English speaking low-cost work and comparatively lower real estate prices were the key attractions for global organizations to outsource their software development services to Bangalore, later developed to be the IT hub of India. IT-BPO sector emerged as one of the most significant growth catalysts for the Indian economy. Fresh boom is IT Infrastructure Management and Indians have taken the lead yet again as the most preferred choice among other economies across the board.