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Wednesday, 7 November, 2001, 13:51 GMT
India software exports slow down
IT billboard
Not all bad news for India's IT industry
India's top software trade body has cut its growth forecast for the industry for the current financial year after the 11 September attacks.

But the information technology sector is still expected to outperform other sections of the economy.

The National Association of Software and Service Companies (Nasscom), said IT export revenues would grow by 30% against 40% as predicted earlier.

Nasscom chairman Phiroz Vandrevala told journalists that the events after the attack on the World Trade Center had led to a rethinking of numbers.

"It is a sensible, middle-of-the-road estimate based on what the world looks like today," he said.


Export revenues for the IT industry were expected to rise to 370bn rupees ($7.7bn) in 2001/2 from 283.5bn rupees in the last financial year.

India is extremely well placed on the parameters of workforce, market access and work culture to take advantage of the growth in business process outsourcinge

Nasscom President Kiran Karnik
But second quarter profits grew by just 19.6%, way below last year's 60.9% showing.

India's IT industry is also increasingly concerned over its international competition, especially from China.

And software companies are also looking towards the European market to ofset expected losses in the US market, India's main export destination.

Nasscom said that exports to Europe would increase by 30% by 2005.

Silver lining

But the trade body is expecting an improved outlook next year especially in the software services industry with global companies looking to cut costs and sourcing their business in India.

"Even though the IT industry is going through a challenging period especially in the US, the positive side is that our customers... are looking to increase their business with India in the next 12-24 months," Nasscom said in a statement.

India is also hoping to cash in on a demand for work rebuilding data bases for several companies housed in the World Trade Center whose records were destroyed in the attacks.

"Basically India is extremely well placed on the parameters of workforce, market access and work culture to take advantage of the growth in business process outsourcing," Nasscom president Kiran Karnik told the BBC.

See also:

17 Aug 01 | Business
India software industry fears rivals
20 Jul 01 | Business
Indian firms defy tech slowdown
10 Jul 01 | Business
Infosys profits jump
17 Apr 01 | Business
Asian exodus from Silicon Valley?
30 Mar 01 | Business
Wipro shares dive
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