India’s National Association of Software and Services Companies (NASSCOM), the biggest association of software and services companies, has said that it now expects industry growth this year to be at the lower end of its earlier forecast.
It now expects industry export revenues of $75-77 billion in FY 2013. Growth will be led by remote infrastructure management, business process outsourcing (BPO) and testing services, Nasscom said.
Emerging verticals such as retail, healthcare and utilities will grow twice as fast compared to mature verticals such as finance.
The assessment comes in the wake of a worldwide slowdown in economic growth and cutbacks by big corporations in their IT budgets. Europe, which has been passing through an uncertain period due to the soverign debt problems in certain countries, has hit the growth of global companies such as Infosys, TCS and Wipro.
“For FY2013, a year marked by significantly varied trends, the industry is expected to meet the lower-end of its growth guidance and at least achieve a double-digit growth,” the association said in its mid-year review.
The estimate is based on NASSCOM’s analysis of Indian listed companies, multinationals and GICs; and industry sectors – IT services, BPO, ER&D and Products. It takes into account the industry performance for the first half year and global technology spending trends.
Interestingly, the slow down in Europe has actually helped some Indian companies to expand their reach in the continent. Accenture recently said the slowdown helped open up companies to the idea of outsourcing non-core services, such as IT maintenance, which they would otherwise have done in-house.
Nasscom too said there was increased focus on outsourcing due to the current financial troubles. It is, in its words, a ‘fast growing’ region.
“Technology is increasingly becoming an integral part of every industry and in a multi-device connected world, new opportunities are being created for solutions on mobility, analytics, cloud and collaboration. These opportunities are also enabling growth of new companies from India that are serving both global and local markets,” Nasscom said.
The domestic market in the country industry is also increasing technology adoption within the government sector and the SMB market, it said.