Information technology (IT) is amongst the fastest growing sectors in the country. Its contribution to GDP rose from 1.2 per cent in 1999-2000 to 5.2 per cent in 2006-07 and to an estimated 5.5 per cent in 2007-08. Growth of Indian IT industry has been driven by the IT software and services (IT services) and IT enabled services (ITES). The software and services (IT services) industry of India has been moving up the value chain, giving India a formidable brand equity in the global markets. The Indian software and services exports including ITES-BPO are estimated at US$ 40.3 billion (Rs.
163,000 crore) in 2007-08 as compared to US$ 31.4 billion (Rs.
141,000 crore) in 2006-07, showing an increase of 28.3 per cent in dollar terms and 15.6 per cent in rupee terms.
Business Process Outsourcing (ITES-BPO) sector has emerged as a key driver of growth for the Indian software and services industry. It has become the biggest employment generator amongst young college graduates. The total number of IT and ITES-BPO professionals employed in India have grown from 284,000 in 1999-2000 to over 1.63 million in 2006-07. In addition, the industry helps to create millions of job opportunities through direct and induced employment in telecom, power, construction, facility management, IT, transportation, catering and other services.
Indian companies are expanding their service offerings, enabling customers to deepen their offshore engagements and shifting from low-end business processes to higher ones. They are also enhancing their global service delivery capabilities through a combination of greenfield initiatives, cross-border mergers and acquisitions, as well as partnerships and alliances with local players. This has helped them execute end-to-end delivery of new services.
Also, a majority of companies have already aligned their internal processes and practices to international standards such as International Organization for Standardization (ISO); Capability Maturity Model (CMM); and Six Sigma. This has helped establish India as a credible sourcing destination. As of December 2007, over 498 India based centres (both Indian firms as well as MNC owned captives) have acquired quality certifications with 85 companies certified at Software Engineering Institute (SEI), Carnegie Mellon Capability Maturity Model (CMM) Level 5 (higher than any other country in the world).
Department of Electronics and Information Technology (DIT) is the nodal organisation
in the country, responsible for formulation, implementation and review
of national policies in the field of information technology. All policy
matters relating to silicon facility; internet; computer based information
technology and processing including hardware and software; standardization
of procedures and matters relating to international bodies; promotion
of knowledge based enterprises; e-commerce; information technology education;
etc are addressed by it.
The department has been making continuous
efforts towards making India a front-runner in the age of information
revolution. Some of the major initiatives undertaken by it include:-
- A 'National
Taskforce on Information Technology and Software Development' was
formed with the objective of framing a long term 'National IT policy'
for the country and also for removing the impediments to growth of the
infotech industry. The taskforce suggested various measures towards
building India's IT industry and proliferating the use of IT in the
country. It submitted its recommendations in the form of three key reports
to the Government.
- Enactment of the Information
Technology Act, which provides a legal framework to facilitate electronic
commerce and electronic transactions; prevent computer crimes; promote
electronic filing or documentation and digital signature. It aims to
create an enabling environment for e-Governance and to boost e-Commerce
in the country.
Information Centres (CICs) have been set up in the seven North East
States and Sikkim for socio economic development of the region. These
CICs provide internet connectivity, e-mail facilities, interface between
citizens and government, distance learning programs, information on
national programmes, disaster management system, public health awareness,
etc to the public.
- E-Governance is one of the areas in which Information and Communication Technology
(ICT) is having a profound impact on the way governments function and
the manner in which government services are made available to the citizens.
The e-governance projects are expected to increase efficiency, enhance
effectiveness and improve quality of the government services. Hence, National
e- Governance Plan (NeGP) has been announced with the vision of
making all government services accessible to the common man in his or
her locality, through common service delivery outlets and ensure efficiency,
transparency and reliability of such services at affordable costs. Besides,
various IT activities such as development of software applications packages,
creation of e-governance infrastructure, National ID, citizen databases,
smart card, etc are being taken up on pilot scale basis.
Wide Area Network (SWAN) is a scheme for establishing state wide
area networks across the country in 29 States and 6 Union Territories
over a period of five years. The scheme envisages to provide central
assistance to States and Union Territories (UTs) for establishing SWANs
from State and UTs headquarters upto the block level with a minimum
bandwidth capacity of 2 Mbps.
- State Data Centres have been identified as one of the
important elements of the core infrastructure for supporting e-Governance
initiatives under NeGP. It is proposed to create data repositories or
data centres in various States so that common secured data storage could
be maintained to serve host of e-Governance applications.
Service Centres (CSCs) are one of the three infrastructure pillars
of NeGP and are deemed to serve as the physical front end for delivering
government and private services at the doorstep of a citizen. The government
has approved a scheme for facilitating establishment of 100,000 broadband
internet enabled CSCs in rural areas of the country, to be implemented
in public private partnership.
- Unique ID for BPL families is a project launched with
the objective of creating a core database of all residents of the country
and assign a unique ID number to all such residents over 18 years, in
order to facilitate better targeting of government social welfare schemes
and poverty alleviation initiatives.
- e-District projects have been launched with the objective
of computerising the backend workflows at the district level with appropriate
business process reengineering (BPR); reduce the work load at the district
level; ensure fast processing of cases or grievances; and enable better
monitoring of various government schemes. It aims at bringing a number
of services online, in a web-based mode, including applications under
the Right to Information Act; applications for house sites, ration cards,
transfers of teachers, inclusion in the electoral roll, filing of police
complaint, issue of birth/death certificates and copies of land records.
Most of these services are provided at the district level and they serve
as the primary interface between the government and the citizens.
Informatics Centre (NIC) has been instrumental in steering Information
and Communication Technology (ICT) applications in Government departments
at Central, State and District levels. It is facilitating improvement
in government services; wider transparency in its functions; and improvement
in decentralised planning and management. Some of the major projects
undertaken by it include budget computerisation; central excise computerisation;
commercial tax computerisation; courts computerisation project for supreme
court, high courts and district courts; agricultural census and marketing;
parliamentary elections data transmission and analysis; land records
computerisation; and utility mapping project; etc.
Further, in order to ensure that the benefits of IT reach the common man, Government has initiated a move to make available tools and fonts in various Indian languages freely to the general public. Software tools and fonts for 10 Indian languages namely Hindi, Tamil, Telugu, Assamese, Kannada, Malayalam, Marathi, Oriya, Punjabi and Urdu languages have already been released.
India has the potential to develop and manufacture Electronics/IT Hardware for the global markets. But, the industry faces limitations on account of certain factors like high incidence of taxes; inadequate infrastructure; high cost of finance; transaction cost; freight and power; low volumes of production and inverted customs duty structure in some products; etc. The Government has identified growth of Electronics and IT Hardware manufacturing sector as a thrust area and has been providing a package of incentives for the Electronics/IT Hardware manufacturing sector with the objective of:- (i) making the industry globally competitive; (ii) attracting more FDI into it; (iii) bringing down the prices of the end products as well as the production costs; (v) increasing volumes to take advantage of efficiencies of scale; (vi) increasing the demand; etc.
As a result of all such efforts, India
is placed among the fastest growing IT markets in the Asia-Pacific region.
Global software giants such as Microsoft, Oracle and SAP have established
their captive development centres in here. Today, India is a preferred
destination for ITES due to its distinct advantages, which lay in its
supportive government policies; infrastructural facilities; low manpower
cost; growing knowledge pool; specialised technical skills; higher productivity
and quality of service; etc. This increasing attractiveness as an investment
destination in IT has even led to a reversal of the brain drain i.e. the
people of Indian origin who went to pursue careers abroad are now attracted
to work in India itself.