Snapshot

Digital Innovation Hub

India is emerging as the hub for “Digital Skills”. The country spends $1.6 bn annually on training workforce in the sector. The industry is the largest employer within the private sector, employing 3.9 mn people. India is transforming into a digital economy with over 450 mn plus internet subscribers; only second to China.

Indian IT industry has more than 17,000 firms, of which over 1,000 are large firms with over 50 delivery locations in India. The country's cost competitiveness in providing IT services, which is approximately 3-4 times more cost-effective than the US, continues to be its unique selling proposition in the global sourcing market.

The National Optical Fibre Network (NOFN) aims to connect all 250,000 Gram Panchayats (village council) in the country with high-speed broadband.

Up to 100% FDI is allowed in Data processing, Software development and Computer consultancy services; Software supply services; Business and management consultancy services, Market research services, Technical testing and Analysis services, under automatic route

100% FDI is permitted in B2B E-commerce.

for further details, please refer FDI Policy

  • 8 %

    Share in India's GDP

  • >55 %

    Share in global outsourcing market

  • 19 %

    E-commerce growth

  • >45 %

    Share in Indian services export

Largest market share in global services sourcing industry

Largest market share in global services sourcing industry

IT Industry

Second largest tech startup hub of the world

Indian IT

Second highest number of internet subscribers in the world

Industry Scenario

#1 sourcing destination for IT-BPM globally

The IT-BPM industry stood at $177 bn in 2019 and is expected to grow to $350 bn by 2025. The IT-BPM industry is the largest contributor to the total exports of the country, with 43% of the IT-BPM services being exported in 2018. 

The sector is headed towards achieving $1 tn digital economy by 2022. The country has become the global digital capabilities hub with around 75% of global digital talent present in the country.
 

Growth Drivers

  • Skill development and R&D

    $ 1.6 bn is spent annually on training workforce and growing R&D
  • The National Optical Fibre Network (NOFN)

    68,889 Gram Panchayats connected by optical fibre (til Jan 2017)
  • Digital India campaign

    A $ 20 bn Investment covering mobile connectivity across India
  • Start-up revolution

    IoT, machine learning, artificial intelligence and healthcare
  • Open

    National Cyber Security Policy 2013

    To protect information and information infrastructure in cyb…

  • Open

    National e-Governance Plan (NeGP)

    E-Governance in India has steadily evolved from computerizat…

  • Open

    National Policy on Information Technolog…

    To strengthen and enhance India’s position as the Global IT…

  • Open

    National Policy on Software Products 201…

    To promote the creation of a sustainable Indian software pro…

  • Open

    Policy framework for satellite communica…

    To develop a healthy and thriving communications satellite a…

  • Open

    Software Technology Parks (STP) Scheme

    The STP scheme is for providing facilities to IT industry fo…

  • Open

    Special Economic Zones (SEZs) Policy

    An Act to provide for the establishment, development and man…

  • Open

    Tripura IT/ITeS Policy & Roadmap, 20…

    Development of infrastructure and human capital for one-stop…

Investible Projects

Investment Opportunities in IT & BPM

  • Projects

    301

  • Opportunity

    $1.38 bn

  • Promoters

    77

  • District

    72

  • Private Projects

    7

  • Govt. Projects

    294

open

$139.58 mn

IT/EMC Park at Guwahati

State (s) Assam
open

$89.7 mn

Setting up a Rural BPO in Assam

State (s) Assam
open

$72.92 mn

Integrated Infrastructure Improvement Project [Bhubaneswar]

State (s) Odisha
open

$59.98 mn

IT Park at Silchar

State (s) Assam

Major Investors

Data on Map

  • IT Industries in India
  • IT Sector

Latest in IT & BPM

FAQ

Frequently
Asked Questions

  • What are the steps taken by Department of Electronics and Information Technology (DeitY) to support the growth of the sector?

    The steps taken are as follows:
    a) Infrastructure support: The Department has set up Information Technology Investment Regions (ITIRs). These regions are supported equipped with excellent infrastructure.
    b) R&D promotion: 150% of expenditure incurred on in-house R&D is also available under the Income Tax Act.
    In addition to the existing scheme for funding R&D projects, the department has put in place the 2 key schemes:
    i) Support International Patent Protection in Electronics & IT (SIP-EIT).
    ii) Multiplier Grants Scheme (MGS).
    c) Tax incentives: Over the years, the Government has been taking steps to bring down the total taxation level on electronics hardware.

  • What is the overview of the IT BPM sector in India and the performance of this sector in recent times?

    India's IT BPM industry amounts for 56% of the global outsourcing market size. The sector has witnessed a series of investments in recent times. Ministry of Electronics and Information Technology (MEITY) has approved 67 proposals worth $ 2.5 bn; 16 venture funds have been set up and equity inflow of $ 1.8 bn in computer software and hardware sector.

    You can find details regarding reforms, information on sub-sectors and government targets and initiatives in the Achievement report at the link.

  • Which IT Enabled Services are considered to be part of BPO operations?

    As per Central Board of Direct Taxes (CBDT) notification No. 890E dated 26 September 2000, the list of eligible IT enabled services under BPO operations considered in IBPS are as under:
    i) Back office operations.
    ii) Call centres.
    iii) Content Development or Animation.
    iv) Data Processing.
    vi) Geographic information System Services.
    vii) Human Resource Services.
    viii) Insurance Claim processing.
    ix) Legal Databases.
    x) Medical Transcription.
    xi) Payroll.
    xii) Remote Maintenance.
    xiii) Revenue Accounting.
    xiv) Support Centres.
    xv) Website services.

    As per NASSCOM, BPO includes following processes that may be IT-enabled, do not necessitate on-shore presence and are hence, offshore-able:
    1) Customer Interaction & Support (CIS)- CIS includes all forms of IT-enabled customer contact, inbound or outbound, voice or non-voice based support used to provide customer services, sales and marketing, technical support and help desk services.
    2) Finance & Accounting (F&A)- F&A includes activities such as general accounting, transaction management (account receivables and payables management), corporate finance (e.g. treasury and risk management, and tax management); compliance management and statutory reporting, etc.
    3) Horizontal-specific BPM services- Services that are reasonably similar across industries. Horizontal BPM services include Customer Interaction and Support (CIS), Finance and Accounting (F&A) and other related processing services, Knowledge Services, Human Resource Management (HRM), Procurement BPM, etc.
    4) Human Resources Processing- HR processing services includes services that support the core HR activities plus talent management activities and associated business processes such as benefits, payroll and talent management.

  • What are the Export Promotion Schemes offered by the Ministry of Technology and Information Technology (MeITY)?

    The two major export promotion schemes launched under the Ministry of Electronics and Information Technology are:
     

    1) Software Technology Parks (STPs): STP of India was set up as an autonomous body in 1991.
     Some of the benefits offered are:
     a) Customs duty exemption
     b) Accelerated depreciation
     c) 100% FDI permitted through automatic route.


     2) Special Economic Zone (SEZ): They were set up with an objective of providing an international competitiveness. Some of the benefits are:
     a) 100% income tax exemption on export income
     b) Duty free import. Please note that SEZ are for multiple sectors and these benefits extend to sectors other than IT BPM 

    For more information, click here.

  • How local entrepreneurs can participate in IBPS?

    An entrepreneur can form a Consortium with a Company registered anywhere under Companies Act 1956/2013 which is able to fulfil the other eligibility criteria(s). The eligible Indian Company must have at least 26 % equity shareholder in the Consortium and commit to maintain minimum equity shareholding (26%) for at least three years.

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