Indian Software, services revenue to grow at 21-24% to $62 b

India’s software and services revenue is poised to grow between 21 and 24 per cent during 2008-09 to touch $62-64 billion. The growth rate projections for FY09 are a tad lower than 28 per cent growth achieved in FY08, on account of a possible slowdown in decision-making on new projects and also due the fact that the industry now operates on a much larger base, according to media reports.The President of Nasscom Mr. Som Mittal says “While almost 70 per cent of the IT spend is on existing projects, about 30 per cent is on new projects which is a discretionary spend. The decision-making on new project gets affected in a challenging environment.”

The global crisis and US economic slowdown would be the big concern for the Indian IT sector and services. The speculation over the future of outsourcing in India is not clear, despite reportedly given green signals from US leaders. On the other hand, the currency fluctuation is another factor that determines the growth of the IT sector. Of late, there is fluctuation in both rupees and dollar, earlier it was rupees on appreciation and now the dollar is on appreciation against rupees. Many companies in US have been adopting to cost cut policies in order keep their budget intact, whereas this will have huge impact on Indian companies. Even companies have been cutting jobs to reduce their cost in US. Certianly, this a tough time for the Indian IT companies.