IT Industry of India

In India, the software boom started somewhere in the late 1990s. Most of the Indian software companies at that moment offered only limited software services such as the banking and the engineering software. The business software boom started with the emergence of Y2K problem, when a large number of skilled personnel were required to fulfill the mammoth database-correction demand in order to cope up with the advent of the new millennium

The profile of the Indian IT Services has been undergoing a change in the last few years, partly as it moves up the value chain and partly as a response to the market dynamics. Ten years ago, most US companies would not even consider outsourcing some of their IT projects to outside vendors. Now, ten years later, a vast majority of US companies use the professional services of Indian Software engineers in some manner, through large, medium or small companies or through individuals recruited directly.

The market competition is forcing organizations to cut down on costs of products. The professional IT services on the other hand are becoming increasingly expensive. The offshore software development model is today where onsite professional services were ten years ago. There is a high chance (almost a mathematical certainty), that in less than ten years, the vast majority of IT services (software development being just one of them) from developed countries, will be, one, outsourced and two, outsourced to an offshore vendor.

Despite the global economic slowdown, the Indian IT software and services industry is maintaining a steady pace of growth. Software development activity is not confined to a few cities in India. Software development centers, such as Bangalore, Hyderabad, Mumbai, Pune, Chennai, Calcutta, Delhi-Noida-Gurgaon, Vadodara, Bhubaneswar, Ahmedabad, Goa, Chandigarh, Trivandrum are all developing quickly. All of these places have state-of-the-art software facilities and the presence of a large number of overseas vendors. India’s most prized resource is its readily available technical work force. India has the second largest English-speaking scientific professionals in the world, second only to the U.S. It is estimated that India has over 4 million technical workers, over 1,832 educational institutions and polytechnics, which train more than 67,785 computer software professionals every year. The enormous base of skilled manpower is a major draw for global customers. India provides IT services at one-tenth the price. No wonder more and more companies are basing their operations in India.

The industry is in an expansion mode right now, with dozens of new offshore IT services vendors emerging everyday, the industry has a high probability of being subjected to the 80:20 rule in not too distant a future. In perhaps another ten years, 80 percent of all outsourced offshore development work will be done by 20 percent of all vendors, a small number of high quality, trusted vendors. Only a few select countries and only the most professional companies in those countries, will emerge as winners. India will definitely be the country of choice for offshore software development. We have the potential to become and remain the country of choice for all software developments and IT enabled services, second only to the USA. The third choice could be far distant.

India is among the three countries that have built supercomputers on their own. The other two are USA and Japan. India is among six countries that launch satellites and do so even for Germany and Belgium. India's INSAT is among the world's largest domestic satellite communication systems. India has the third largest telecommunications network among the emerging economies, and it is among the top ten networks of the world.

To become a global leader in the IT industry and retain that position, we need to constantly keep moving up the value chain, focusing on finished products and solutions, rather than purely on skill sets and resumes. We need to be able to package our services as products, rather than offering them as raw material. We need to be able to recognize and build up on our strengths and work on our weaknesses.

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