Pierre Audoin Consultants (PAC), consulting and analysis of Software and IT services (SITS) market estimates that Indian SITS market is poised to grow three times faster than the worldwide market. As per PAC estimates, India will grow at a CAGR 17% for the period 2010-2015; which is considerably high compared to a CAGR of 5.3% for worldwide SITS market for the same period. However, the overall market volume of the Indian market vis. a vis. the world remains a matter of concern.
Indian SITS market has shown tremendous growth against all odds, and shown an above average growth as compared to the global SITS market. The high growth market has made India the preferred destination for global companies. Despite tough competition from China and Philippines, and rising Latin America, India still attracts companies due to its cost advantage, qualified skillset and enhanced value proposition.
Worldwide SITS growth rate vs. India SITS growth rate
The Indian IT suppliers are fast adopting changes in the IT industry, and developing additional service lines and revenue streams, to attain high growth rates even in tough times. Indian market grew almost five times the worldwide market in 2010 and PAC estimates show the overall growth to be thrice the worldwide growth rate when the world economy is expected to pick up from 2012.
However, the overall market volume of the Indian market, as compared to the worldwide IT services market, remains a pittance. According to PAC, India reported EUR 33 billion revenue with offshore IT services in 201 I, representing 72% of the worldwide offshore activities. But the domestic IT services market, though very dynamic, has remained rather small. With a total turnover of EUR 7.6 billion, it represents just 1% of the global IT services market, far behind the USA (39%) and Western Europe (30%).
PAC forecasts the overall domestic Indian SITS market volume to reach EUR 16.5 billion by 2015, but even that would be just 2% of the worldwide market which is expected to reach EUR 915 billion. Thus, though Indian domestic market would have doubled its share in the global market in the next four years, it would still have some way to go in becoming a significant part of the world IT services market.
Indian IT companies such as Infosys, TCS, and HCL have always...