Led by massive digitisation following the Covid-19 pandemic outbreak, the Indian technology services are set to spike to $300-350 billion in revenues by 2025. According to the latest Nasscom report, the growth in technology services is likely to accelerate by 2-4% on key services including cloud, artificial intelligence AI, cybersecurity along other emerging technologies over the next five years.
The report jointly released by McKinsey & Company Knowledge Partners – also noted that technology-driven companies are leading the path to a faster recovery globally.
“With the consumers' ever-evolving needs, enterprises are keeping up with continuous innovation, leading to a shifting global marketplace and 10 per cent annual growth in the IT services sector, generating high returns for shareholders and investors in the last decade,” the report said.
According to the report, the technology services sector is estimated to be around $1 trillion and is among the most significant contributors to economic growth worldwide including India. “The industry now produces about 27% of the nation's exports and provides livelihoods to about 4.4 million people,” the report said adding “…India's technology services industry could accelerate growth by 2-4% over the next five years, reaching $300-350 billion in annual revenues if it can win in the cloud, AI, cybersecurity, and other emerging technologies.”
While analysing various digital initiatives the report says that the new technology is driving growth across various sectors including banking and finance, healthcare and governance. The report suggests that the technology services industry continues to be a prime driver of India's digital dream with a contribution of 8% to the overall economy.
“The Indian Technology services sector can utilise the potential of deep technologies like cloud, AI, ML, IoT, etc, through effective transformational practices, thereby contributing to the overall economy in the coming decade. The government needs to encourage and support digital literacy and skilling to ensure its talent, energy, imagination, knowledge, and unmatched commitment unites to address the customers' surging needs,” Nasscom president Debjani Ghosh said.
As the competition intensifies, scale and specialisation will be critical to succeed in the next decade of technology services and providers will need to refresh their service lines and offerings and stay relevant to cater to these more digitally adept enterprises, who expect higher-quality services and have very different buying behaviour, the report added