Software is a fraction of India’s $176-billion information technology industry. Much like offshoring, Bank of America Merrill Lynch sees the nation turning into a global software hub.
IT Majors Chase Growth
Software products and platforms were the top-most priority for chief executive officers in IT services for enhancing digital capabilities, according to industry lobby Nasscom’s survey earlier in the year.
After HCL Technologies bought IBM’s mature software products in December, it now has a significant exposure to the software sector with the company expecting 15 percent of its revenue from software compared with 8 percent earlier.
TCS, the world’s third-largest IT services provider, already has platforms like core-banking software BaNCS and insurance and pension management software Diligenta, which played a critical role in accelerating the company’s growth, according to BofAML.
Capital And Talent
India has seen a 70 percent increase in number of venture capital funds with active investments in the past five years, according to the report. That drove a 15-17 percent annualised growth in the number of software startups with more than $1.6-billion investment in SaaS companies.
There is also a talent pool that’s fast maturing and could be another important lever given that global software giants have 5-25 percent of their workforce in the country, BofAML wrote. About 1,250 global corporates having technology centres in India aids in development of talent, it said.
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