India offers significant strengths in the areas of remote development of software
and IT outsourcing.
- Large Human Resources
- Investor Friendly Atmosphere
- IT Enabled Services
- Competitiveness and Remote development India
Large Human Resource
Every year out of the 2.4 million graduates 97 percent find jobs in the IT industry.
This talent caters largely to remote development, IT outsourcing and high quality
domestic software development. At this rate there can be approximately 17 million
people available to the IT industry by 2008. The IT outsourcing and remote development
industry which currently employs 0.5 million people, will employ over 2 million
people directly and create indirect employment opportunities for at least an additional
2 million people by 2008.
Indian Education System
The Indian education system places strong emphasis on mathematics and science, resulting
in a large number of science and engineering graduates. Mastery over quantitative
concepts coupled with English proficiency has resulted in a skill set that has enabled
the country to take advantage of the current international demand for remote development
and IT outsourcing.
Investor Friendly Atmosphere
The investor friendly atmosphere created by the liberalized policies of the Government,
has resulted in huge inflows of FDI from NRIs including Overseas Corporate Bodies
(OCBs) owned by NRIs, and also made foreign technology accessible.
Keeping up the pace the Indian Government has passed the IT bill in the year 2000,
which provides a legal framework for the recognition of electronic contracts, prevention
of computer crimes, electronic filing of documents etc. Most of the states in India
have come up with the concept of Software Technology Parks for the promotion of
IT outsourcing, ITES and remote development companies.
All these initiatives by the Government have ratified the perception that India
is the destination of choice for IT enabled services as well as IT outsourcing and
By realizing its long-term potential, the Indian IT and IT-enabled services industry
could be one of the most powerful drivers of India's economic growth. As per the
NASSCOM-McKinsey study 2002, the share of IT and ITES in the GDP is going to increase
substantially from 1.4 percent in 2001 to 7 percent by 2008. By achieving its long
term potential, the IT industry including remote development and IT outsourcing
industries will dramatically boost Indian economy.
Increase in Foreign Exchange Inflows In addition, revenues from IT outsourcing,
remote development and IT enabled services exports are likely to grow at a significantly
higher rate than other exports and invisible and by 2008 will exceed all other invisible
combined. IT outsourcing and remote development and IT enabled services exports,
which currently account for 8 percent of foreign exchange inflows, will contribute
more than 30 percent of foreign exchange inflows in 2008.
In terms of market share, the long-term potential for India translates into a 4
percent market share in IT services IT outsourcing, remote development and IT-enabled
In the past few years, the Indian IT industry has pursued the goal of attaining
the highest international standards of quality. A World Bank funded study conducted
as early as 1992 to discuss Indian software strategies had concluded that more and
more vendors in the US prefer to get their IT outsourcing and remote development
needs addressed by India for its quality and cost advantage.
Indian players have created a strong value proposition in the IT software, IT outsourcing,
remote development and services arena. Today India can boast of vendor sophistication
--with more than 200 companies being quality accredited and serving the needs of
over 255 Fortune 500 companies. Today, the world looks towards the Indian IT software
and services industry for its good quality and high performance.
According to McKinsey & Co., India has and will continue to have a growing number
of vendors successfully working on complex projects across all areas of software
and services, and performing at levels comparable to those of leading global players.
As of 31st March 2002, India had 42 companies at SEI CMM Level 5 assessment. The
quality & maturity of the Indian software industry can be measured from the fact
that already 316 Indian software companies have acquired quality certifications
and more companies are in pipeline to do so.
The other heartening feature has been the growing acceptance and adoption of the
newly emerging People-Capability Maturity Model (People-CMM) by the Indian software
industry. For a country like India, with its large assets in the form of skilled
human resources, the relevance of People CMM needs no emphasis. A large number of
Indian IT software and services companies have been quick to realize this and have
either implemented or initiated these programs. The high quality apart from its
low cost has resulted in making India a choice destination for IT outsourcing, remote
development and IT enabled services. Remote development India has become the buzzword
for many business managers in UK, Europe main land and US.