Information
technology (IT) industry is one of the most significant growth contributors for
the Indian economy. The industry has played a significant role in transforming
India’s from a slow moving bureaucratic economy to a land of innovative
entrepreneurs and a global player in providing world class technology solutions
and business services it has also played a role in transforming India from a
rural and agriculture-based economy to a knowledge based economy. Information
Technology has made possible information access at gigabit speeds. It has made
tremendous impact on the lives of millions of people who are poor, marginalized
and living in rural areas. Internet has made revolutionary changes with possibilities of e-government measures
like e-health, e-education, e-agriculture, etc. But now, whether it’s filing
Income Tax returns or applying for passports online or railway e-ticketing, it
just need a click of the mouse. India’s IT potential is on a steady march
towards global competitiveness, improving defense capabilities and meeting up
energy and environmental challenges amongst others. IT-ITeS sector in India, which
mainly focuses on increasing technology adoption, and developing new delivery
platforms, has added loads of revenues. After the economic reforms of 1991-92, major fiscal incentives provided by
the Government of India and the State Governments, like : liberalization of
external trade, elimination of duties on imports of information technology
products, relaxation of controls on both inward and outward investments and
foreign exchange, setting up of Export Oriented Units (EOU), Software
Technology Parks (STP), and Special Economic Zones (SEZ), has enabled India to
flourish and acquire a predominant position in world’s IT scenario. To mitigate
and promote Indian IT industry, the Government of India had set up a National
Task Force on IT and Software Development to examine the workability of
strengthening the industry. Venture capital has been the main source of finance
for software industry around the world. The Government of India is also
actively providing fiscal incentives and liberalizing norms for FDI and raising capital abroad. In
2011, India’s growth has reflected new demand for IT goods and services, with a
major surge in the use of private and public cloud and mobile computing on a
variety of devices and through a range of new software applications. Foreign
technology induction is also encouraged both through FDI and through foreign
technology collaboration agreements. India welcomes investors in Information
Technology sector. Greater transparency in policies and procedures has made
India an investor friendly platform. A foreign company can hold equity in Indian company’s up to 100%. Challenges Cyber security and
quality management are few key areas of concern in today’s information age. To
overcome such concerns in today’s global IT scenario, an increasing number of
IT-BPO companies in India have gradually started to emphasize on quality to
adopt global standards such as ISO 9001 (for Quality Management) and ISO 27000
(for Information Security). India aims to transform itself into a truly
developed and empowered society by 2020. However, to achieve this growth, the
sector has to continue to re-invent itself and strive for that extra mile,
through new business models, global delivery, partnerships and transformation.
A collaborative effort from all the shareholders will be needed to make future
growth of India’s IT-ITeS sector. India is now one of the biggest IT capitals
in the modern world and has presence of all the major players in the world IT
sector. HCL, Wipro, Infosys and TCS are few of the well-known names of IT
companies in India. Future prospects Globalization has had a profound impact in
shaping the Indian Information Technology industry. As the years passed by, verticals
such as manufacturing, telecom, insurance, banking, finance and lately the retail,
have been the growth contributors for this sector. But it is very fast getting
clear that the future growth of IT and IT enabled services will be fueled by
the verticals of climate change, mobile applications, healthcare, energy
efficiency and sustainable energy. The future for Indian IT industry sees a
significant rise in share of technology spent, with more service providers in both
Indian and global target and to bring about new segments and to provide low
cost, flexible solutions to customers.

The IT sector has also led to massive employment
generation in India. The industry continues to bring in employment, thus directly employing about 2.8 million people and
indirectly employing 8.9 million, making it a dominant player in the global
outsourcing sector. However, it continues to face challenges of competitiveness in the globalized and modern world,
particularly from countries like China and Philippines. The IT sector in India
has paved employment for many people. The Indian IT market currently focuses on
providing low-cost solutions in the services business of global IT. The
presence of Indian companies in the product development business of global IT
is very meager, however, this number is slowly on the rise. The prominent trend
is that IT jobs, once were centralized to Bangalore, and are slowly starting to
experience a geographical spread into other cities like Chennai, Hyderabad and
Pune. According to Google estimates,
the Indian community of developers will be the largest in the world by 2018

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India’s growing stature in the Information Age enabled it
to form close ties with both the United States and the European Union. However,
the recent global financial crises have deeply impacted Indian IT companies as
well as global companies.

The fundamental structural changes in the IT services
such as

–         
Cloud
computing

–         
Proliferation
of Social media

–         
Big
data

–         
Analytics

All leading to digital
services and digital economy,
many of the leading companies in India’s IT sector reported lower headcounts in
their financial results.