NASSCOM, predicts software and services exports to cross $40 billion and the domestic market ito touch $23 billion in FY08. "Positive Market Indicators" and "Strong Track Record" are being cited as the reason to safely predict that India will reach $60 billion in software and services exports and $73 to 75 billion in overall software and services revenues, by FY2010.
A careful observation reveals that while exports are expected to reach from 40 to 60 bln USD in the next 2 years, the domestic revenues which is expected to reach 23 bln USD this year are marked to fall to 13-15 bln USD in 2010. I find this a little hard to accept. I am more gungho about the domestic market being able to sustain the US slowdown and make up for a substantial portion of the fall in exports.
On the industry side, things are not looking up. IT stocks are getting battered, margins are being lowered, the Indian rupee is appreciating and the sub-prime crises that is plaguing the US financial markets does not seem to be going away. Add to that high attrition rates, spiraling salaries and shrinking talent pools and you defintely will empathise with the situation that the IT industry finds itself.
The message is very clear and loud. To sustain growth and reach the levels predicted by NASSCOM, IT companies need to look and build forts elsewhere while they wait for the world's largest economy to re-emerge from the recession it seems to be sinking into. But where elsewhere? Europe is already being tapped. Australia too is being tapped. Did we forget the burgeoning businesses in the new darlings of the global economy? China and India....Lots of medium and small businesses are growing at frenetic paces and they need software services support their amazing growth rates. Are we missing the fortune right at our feet? Hope not....