IT AND BPM
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- IT-BPM sector accounts for largest share in total Indian services export (45%).
- IT-BPM sector accounts for 56% of the total global outsourcing market.
- 640 offshore development centers in more than 80 countries.
- Indian IT & BPM industry is expected to grow to USD 300 billion by 2020.
- IT - BPM sector constitutes ~ 9.3% of India's GDP.
- IT-BPM is the largest private sector employer - delivering 3.7 million jobs.
REASONS TO INVEST
- India’s IT – BPM industry amounts for 56% of the global outsourcing market size.
- Rapidly growing urban infrastructure has fostered several IT centers in the country.
- Favorable government policies and incentives to facilitate investments in IT sector.
- Presence of skilled manpower, India is home to a large number of IT professionals.
- IT BPM industry revenues (excluding hardware) is estimated at around USD 130 billion (2015-16).
- Exports from the IT-BPM industry stands at USD 107.8 billion for Financial Year 2015-16 (Segment wise breakup is as under):
- IT services - USD 61.0 billion
- The BPM industry exports - USD 24.4 billion
- ER&D and Software Product Development - USD 22.4 billion
- The IT industry has more than 16000 firms; of which 1000+ are large firms with over 50 delivery locations in India.
- The IT-BPM industry is the largest private sector employer – delivering 3.7 million jobs.
- The sector accounts for 45% share in total services export from the country.
- India is ranked as the 3rd largest tech based start-up hub in the world with over 4200 start-ups in the country.
- Emerging geographies and verticals, non-linear growth due to platforms, products and automation.
- Revival in demand for IT services from US and Europe.
- Increasing adoption of technology and telecom by consumers and focused government initiatives – leading to increased Information and communication technology adoption.
- Use of IT in emerging verticals (retail, healthcare, utilities) are driving growth in Indian IT sector.
- India has been creating a future-ready digital workforce, with more than 0.15 million employees SMAC (social, mobile, analytics, cloud) skills.
- The SMAC (social, mobility, analytics, cloud) market is expected to grow to USD 225 billion by 2020.
- USD 1.6 billion is spent annually on training workforce and growing R&D spend.
- The National Optical Fibre Network (NOFN) is being laid down in phases to connect all the 0.25 million gram panchayats in the country.
- The government's Digital India Campaign envisages a USD 20 billion investment covering mobile connectivity throughout the country, re-engineering of government process via technology and enabling e-delivery of citizen services.
PROVISIONS OF THE 2015-2016 UNION BUDGET :
- Tax rate on royalty and fee for technical service payable to non-residents has been reduced from 25% to 10%.
- The National Optical Fibre Network Programme (NOFNP) to be further speeded up by allowing willing states to execute on reimbursement of cost basis as determined by Department of Telecom.
- Supporting technology driven start-ups - Creating of innovation Promotion Platform and Techno-financial and facilitation support scheme
- Self Employment and Talent Utilization (SETU) to establish as techno-financial, incubation and facilitation programme to support all aspects of start-up business.
- Transfer Pricing - Increase in Domestic Transfer pricing threshold from USD 769,230 to USD 3.07 million.
- Reduction in tax rate on Royalty and Fees from Technical services from 25% to 10%
- CENVAT credit time limit for availment increased from 6 months to 1 year.
- General Anti-Avoidance Rule (GAAR) deferred by another two years and will be implied prospectively.
- 2 days time for service tax/ excise duty registration; electronic filing including digital signature.
- Micro Units Development Refinance Agency (MUDRA) Bank, with a corpus of USD 3.07 billion, and credit guarantee corpus of USD 461.53 million aiming to infuse funding among the new generation entrepreneurs.
- The setting up of IT services, BPM, software product companies, shared service centres.
- Fast-growing sectors within the BPM domain – knowledge services, data analytics, legal services, Business Process as a Service (BPaaS), cloud-based services.
- IT Services and fast-growing sectors within it such as solutions and services around SMAC, IS outsourcing, IT consulting, software testing.
- Engineering and R&D within which the fastest growing sectors are – telecom & semiconductors.
- Accenture (Ireland)
- Cognizant (USA)
- HP (USA)
- Capgemini (France)
- IBM (USA)
- Atos (France)
- Microsoft (USA)
- CDNS (USA)
- Intel (USA)
- Dell International (USA)
- Agilent Technologies (USA)
- Mentor Graphics (USA)
- Oracle Corporation (USA)
- Qualcomm (USA)
- Steria (France)
- Ricoh (Japan)
- SAP (Germany)
- TIBCO (USA)
- Philips (Netherlands)
- Department of Electronics & Information Technology, Ministry of Communications & Information Technology, Government of India
- National Association of Software and Services Companies
- Indian Software Product Industry Round Table
- Other Service Providers Association of India
- Data Security Council of India