The Software & Electronics Industy In India

THE SOFTWARE & ELECTRONICS INDUSTY IN

SOFTWARE INDUSTRY • The Indian software industry truly symbolizes India’s strength in the knowledge based economy. Highly skilled human resources coupled with low wage structure and world class quality have transformed India into a global powerhouse in the Information Technology (IT) software services and solutions sectors

OUTLINE • The Indian Software Industry has grown from a mere US $ 150 million in 1991-92 to a staggering US $ 5.7 billion in 1999-2000. • Indian Software Industry is estimated to be worth USD 1.2 billion. • According to statistics, country's software exports reached total revenues of Rs 46100 crores. • As of the year 2006-07, both software and services revenue grew by 32 percent to $ 22

OPPORTUNITES • Strong cost value proposition, driven by the low cost of quality manpower and high quality work delivery. • India has a large base of English speaking, skilled manpower resource with experience on state-of-the-art hardware and software platforms. This is supported by a flourishing IT education market, producing high quality software professionals across different areas in the field. • The government has announced software export sector tax incentives-setting up of STPs and a VC funds. • India has a well developed infrastructure support to aid connectivity and data transfers.

POLICY INTIATIVES • Besides Special Economic Zones (SEZs) and Export Promotion Zones (EPZs), the government is encouraging the setting up of Software Technology Parks (STPs). • STPs offer zero import duty on the import of all capital goods, special 10 years income tax rebates, availability of infrastructure facilities such as high-speed data communication links, etc. • Foreign companies can set-up operations in these zones either through incorporation of the company as per Indian Companies Act (with 100% equity holding).

GROWTH

EXPORTS

SOFTWARE INDUSTRY LANDMARKS • • • •

THERE ARE COMPANIES LIKE -: TATA CONSULTANCY SERVICES – Asia’s largest software company . WIPRO INFOSYS – Also known for its Exports NASSCOM -

(Tata Consultancy Services and Infosys have emerged as the leading Indian software exporters during 2000-01, clocking exports worth Rs 2,870.26 crore and Rs 1,852.94 crore, respectively.)

NASSCOM • The National Association of Software and Services Companies (NASSCOM), the Indian chamber of commerce is a consortium that serves as an interface to the Indian software industry and Indian BPO industry. • Set up in 1988 to facilitate business and trade in software and services and to encourage advancement of research in software technology. It is a not-for-profit organization.

ELECTRONICS INDUSTRY • THE ELECTRONIC INDUSTRY BEGAIN ITS RACE IN THE EARLY 1960’s. • DUE TO RAPID DEVELOPMENT IN THE 1990’s – GROWTH OF 30% WAS RECORDED. • ELECTRONICS OUTPUT INCREASED BY 15%, 17%, 7.8%, 7.4% and 22.4% in 2002, 2003, 2004, 2005 and 2006, RESPECTIVELY. • REACHED 13.6% BY 2008.

PRODUCTION

OVERVIEW • Electronics Hardware is a US$15-billion (2006-07) industry in India – India constitutes 0.7% of the global market – Consumer electronics (TV, DVD, Audio systems): about US$4.5 billion – Industrial electronics: about US$2.4 billion – Computers (PC, Servers, Laptops): about US$2.9 billion – Communication and Broadcast equipment: about US$2.2 billion – Strategic electronics: about US$1.0 billion

STRUCTURE • Indian industry caters primarily to the domestic market. Exports are limited to passive components like capacitors, resistors, wound components, CDROMs, colour picture tubes, etc. – Major international players like Nokia, Motorola, Siemens, Texas Instruments, LG, Samsung, Sharp and Lenovo have already set up manufacturing operations in India; many more have R&D centers

EXPORTS • The Electronics Hardware industry is expected to grow rapidly in the coming years – Projected US$62 billion in 2010 – 44% GROWTH in domestic consumption (FY 2007-FY 2010) S – Rapid growth in exports

H O W A

• ELCINA Electronic Industries Association of India (Formerly Electronic Component Industries Association) was established in 1967 . • ELCINA has always remained committed to the promotion of electronics manufacturing culture in the country focusing on components-the building blocks of electronics industry.

[p hglzvv • a) India remains a major importer of electronic materials, around $20 billion (Rs84,000 crore now) in 2007. • In the case of exports, the largest share was taken by electronic components, with 47% of total electronic exports. Exports of electronic components have grown at a CAGR of 25% in the last five years. • g) India’s main destination for electronic goods is the US.

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