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Indian IT Industry Vast Growth Potential

Indian IT Industry Vast Growth Potential. IT Industry. India - An Overview Market and Growth Potential Players Opportunities Why India? Contact in India. India - An Introduction. Population States/UTs Geographical Area Languages recognised Business language Per Capita Income**

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Indian IT Industry Vast Growth Potential

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  1. Indian IT Industry Vast Growth Potential

  2. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  3. India - An Introduction • Population • States/UTs • Geographical Area • Languages recognised • Business language • Per Capita Income** • GDP** Over 1 bn 35 3.3 mn sq kms 22 English US$ 534 US$ 650 bn **(at factor cost & at current prices) 1USD=43.54 INR (as on July 4, 2005) Source:CSO Statistics

  4. India - Fast pace Growth • Largest democracy • 4th largest economy by PPP index • 6th largest energy consumer • ForEx reserves skyrocket from USD 42 bn (2001) to USD 133 bn (2005) • GDP growth to continue between 6-8% • 3rd largest economy by 2050: Goldman Sachs • Leading in IT & BPO • Oil & Gas and Biotechnology sunrise industries

  5. India - Leading the world • Hero Honda - largest manufacturer of motorcycles • Moser Baer - among the top three media manufacturers in the world • Pharmaceutical Industry - 4th largest in world • Walmart, GAP, Hilfiger sources more than USD 1bn worth apparel from India • 100 Fortune 500 have set R&D facilities in India including GE, Delphi, Eli Lilly, HP, Heinz and Daimler Chrysler

  6. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  7. Huge and Growing IT Market Size (2002-03) US$ 24 billion Growth rate 28% CAGR (since 1999) 46% Share of IT and BPO 1.4% of GDP 2008 projection 7% Exportsprojected (2003-04) US$ 12 billion to grow at 26-28% Employment Over 650,000 (Second largest employer in IT services sector)

  8. Future Growth Potential USD 35 billion domestic software market By 2008 17 million people available

  9. Growth in Domestic Outsourcing (USD Million) Alignment to domain knowledge needs

  10. Moving up the Value Chain Application development Package Implementation Migration & Re-engineering Maintenance Consulting Embedded software Network Security Network Management Package Implementation E-business applications Web Enabling legacy Facilities management Maintenance Unix-based coding Mainframe Client / Server Internet 1960 Aligned to technology needs

  11. Growth of the Offshore Model % of software export Alignment to business needs

  12. Potential Domestic Hardware Market 2010 4.0 6.7 20.1 13.4 US$ 44 billion By Product Segment By Value Addition 50 6.9 40 5.4 30 10.2 US $ Billion 20 37.4 6.9 6.6 21.8 10 8.3 - Finished Product Sub-assembly manufacture from components Product Manufactured from sub-assembly Total Market: USD 44 Billion IT Hardware. Consumer Electronics Telecom Others Imports Locally Manufactured Value Addition

  13. Potential Hardware Exports USD 25 billion Exports manufacture by Value addition Exports by Value Chain 14 1.4 5 12 10 4.5 8 11 US $ Billion 1.1 13.0 6 3.2 4 7.1 7 2 2.9 0 2 Products & Assemblies Products & Assembly manufacture from sub-assembly Sub- assembly manufacture from components Total Exports: USD 25 Billion OEM + ODM Design Services Products Components Local Imports Value Addition

  14. Focus Areas • Utilities • Transportation • Healthcare • Financial Services • Telecom Equipment • Manufacturing Industries Targeting new verticals Beyond traditional sectors

  15. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  16. Indian Players TCS Wold leading IT consulting services and business process outsourcing company Infosys Provides consulting and IT services to clients globally as partners Wipro Serves over 300 global leaders and is world’s first PCMM, CMMi and CMM Level 5 company

  17. MNC Presence MNCs contribution to export revenues from IT services 23.5%

  18. MNC presence in India Intergraph Corp., USA Kelton Graphics Inc., USA Services IBM, USA Capricorn Systems Inc., USA IBM, USA Manhattan Associates., USA Oracle Inc., USA Products Dun & BradStreet., USA Microsoft, USA Deneb Robotics., USA NOVELL, USA SUN Micro System Inc, USA

  19. MNC presence in India IBM, USA CISCO, USA SUN Micro System Inc, USA Siemens Nixdorf., Germany IT Infrastructure Fujitsu, Japan Hewlett Packard, USA Hughes Network Systems., USA Bull, France Alcatel, France Silicon Graphics Inc., USA Embedded systems Texas Instruments Inc., USA Cadence Design Systems Inc., USA Motorola Inc., USA

  20. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  21. Invest in India • Skills • Quality • Domain • Policy • Infrastructure • Risk

  22. Invest in India Source: NASSCOM India attracts second highest private equity investment in Asia

  23. Invest in India Advancing on the value chain • Package Software Implementation • System Integration • R& D Engineering • Network Management

  24. Partner with India Venture funding activities 2001 - 02 USD 1,100 million 2007 - 08 USD 10,000 million Venture funding activities to increase 9 folds by 2007-08

  25. Export from India Product Services

  26. Export from India Professional Services

  27. Export from India Outsourcing Services

  28. IT Outsourcing - Expanding Opportunities • Software development outsourcing • Product development outsourcing

  29. Destination India Offshoring of outsourcing

  30. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  31. The India Advantage Quality manpower Pro active policy framework Specialised organisations and facilities State-of-the-art infrastructure High quality services

  32. The Intellectual Advantage Skill surplus End-user countries Regional Hubs High USA UK Human Sophistication: Number of workers, labour cost, worker skill level India China Germany Indonesia France Philippines Ireland Singapore Low High Vendor sophistication: Number of vendors, vendor quality India is today a mature region for IT offshore work

  33. The Knowledge Advantage Highly qualified pool of IT professionals Large pool of highly talented software professionals

  34. The Cost Advantage Costs for offshore work 30-50% lower than in US/Europe

  35. The Infrastructure Advantage • Standardisation Testing and Quality Certification (STQC) programme One-stop solution to all quality requirements of electronics industry • Software Technology Parks No corporate income tax up to March 2010 Exemption from local duties and taxes Up to 100% foreign equity permitted Single window government clearance Single point custom bonding and export certification

  36. The Policy Advantage Evolving regulatory regime • IT Act 2000 • EOU status extended to hardware manufacturing units • USD 2580 mn to be spent on e-Governance initiatives • Priority sector status given by banks • Export processing zones established • 487 information communication centres

  37. IT Industry • India - An Overview • Market and Growth Potential • Players • Opportunities • Why India? • Contact in India

  38. Contact in India National Association of Software and Service Companies (NASSCOM) International Youth CentreTeen Murti MargChanakyapuriNew Delhi - 110021Tel 91 11 23010199Fax 91 11 23015452 Email info@nasscom.org

  39. Contact in India MAIT 4th Floor, PHD HouseOpp. Asian Games VillageNew Delhi 110 016 Tel 26855487/26866976/26866976Fax 26851321Email mait@vsnl.com

  40. Contact in India Confederation of Indian Industry (CII) 249-F, Sector 18, Udyog Vihar Phase IV Gurgaon 122015 Tel 0091 124 5014060-67 Fax 0091 124 5014080/5013874 E mail s.ray@ciionline.org

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