March 1, 2021

IT –Business Process Outsourcing Industry Growth Scenario

Mr. Puneet Mittal
Mr. Puneet Mittal

Over the past two decades there has been a constant and the substantial growth in the Indian IT – BPM services Industry adding up to 8% to India’s GDP as compared to 0.5% in the year 1995. Today the aggregate industry revenue is USD 108 billion compared to a merely USD 100 million in the year 1992. The industry has come a long way contributing 23% to 25% to the India’s export achieving 52% share of Global Outsourcing market. On further bifurcating the market share in IT Outsourcing and Business Process Management (BPM) outsourcing it is 62% and 37% respectively.

Indian IT Industry is highly versatile having capabilities of providing complete end to end services in IT, BPM, Products development, engineering research and development. The portfolio of services has been ever expanding. Under IT services, Infrastructure outsourcing, Integration, Outsourced product development,    software testing and IT strategy & consulting is being offered. Customer support, Transaction processing, Knowledge legal services, Data Management & Analytics services are being delivered in Business Process Management. Software Products are being developed for Enterprise solutions, Platforms, Applications, SAAS and B2C

Source: Nasscom

products. A big share of services in Internet and eCommerce space is being delivered to cater to growing eCommerce demand. eCommerce platforms, Online marketing, Social media technology & solutions, along with the content development and management are being  delivered globally to eCom enterprises. India has become a big hub for Engineering research and development including CAD/CAM services,  embedded design & development and product engineering.

The comprehensive portfolio of service offerings has put India on the world map as a major IT force. Of the total Foreign Direct Investment (FDI) 7% is in IT-BPM Industry in last 12 years amounting to USD 12 billion investments by Private Equity

Photo_Anil Sharma_PSI
Mr. Anil Sharma

Funds and Venture Capitalists. In the Indian IT Industry, the Corporates are emerging as a global multinationals where customers from more than 75 countries are being served in nearly 200 cities with 580 plus delivery centers, comprising of Fortune 500 companies, Small and Medium size businesses and Governments.  India is today, the global biggest engineering research hub with more than 750 captive centers having world’s six largest corporations who are employing 20 percent of their workforce in India.

With the business growth the need and demand of skilled human resource in IT/ITES has always on the rise, outnumbering the supply. There is direct employment to nearly 3 million and indirect employment of 9 million people in the Indian IT Industry with 3% foreign nationals employed. Industry is one of the world largest employers of young graduates and post graduates. The largest talent pool of 4.7 million graduates and post graduates are employed in Indian IT Industry. Not only the supply of cost effective skilled manpower in India is driving the growth but there are other drivers which are assisting the ps2IT business eco-system. The maturing entrepreneurship and availability of funds has promoted large number the Start-ups to commence and execute business with specific domain focus including Cloud computing, Data Services, Mobile, Social media, Productive tools, eCommerce & Education.  There were 450 startups in the year 2012. The internal infrastructure in the country to deliver the services has not only improved but enabling quality delivery of products and services. The Internet bandwidths, mobile connectivity, number of installed base computers, workstations, availability of mobile computing devices, have all fueled the growth. The hosting facilities with large efficient Data centers are helping in research and development.

The availability of improved infrastructure has resulted in the growth of domestic IT-BPM market also and created demand for services by the IT users. An increase of 14.2% is recorded in the domestic IT market in 2012. This is due to large number of Internet subscribes (24 million), mobile subscribers (890.6 million) Mobile Internet subscribers (87.1), Telecom subscribers (921.47 million), Social network users (70 million), Facebook users (65 million), Online retail users (more than 37 million unique visitors have shown 43% growth).


The Indian IT Industry is on the high growth trajectory and there is a tremendous potential of growth in terms of export revenues. By the year 2020 the IT export revenue is expected to reach 175 billion and 50 billion in domestic IT market. The acquisition of emerging geographies, focusing on specific verticals that are driving growth, evolution of unique business models and service delivery, flexible operational metrics providing advantage to clients and efficiency to service providers, domain expertise, and through understanding of customer’s expectations of technology and changing business requirements are key differentiators driving growth. On the top of it, IT-BPM services spending will increase by 6% in 2013.

India is the preferred destination and provides five prolonged value propositions. These are, more than 25 years of outsourcing experience, unlimited pool of talent, competitive pricing, strong ecosystem and customer centric approach.

Mr. Puneet Mittal,

CEO, Pratham Software

Mr. Anil Sharma,

Pratham Software