Technopreneurship and Development of IT and ITeS Industry in India

Primarily, among numerous sectors of
the economy IT and ITeS industry is one whose
service is required for the rapid growth of the
economy and primarily the information technology
and information technology enables services sector
has covered the in-house development of the
nations’ infrastructure. In general, IT and ITeS
handles most of the official and unofficial
information. There is a lightning growth of Indian
software industry with the participation of global
corporate dominators for the past two decades.
Indian IT sector has contributed most in the
production and export of the software based
applications to all over the universe. This paper
highlights the growth and performance of IT and
ITeS and also examined the contribution and
development of IT and ITeS in Indian industry.

1. Imperial Journal of Interdisciplinary Research (IJIR)
Vol-3, Issue-11, 2017
ISSN: 2454-1362, http://www.onlinejournal.in

Imperial Journal of Interdisciplinary Research (IJIR) Page 51

Technopreneurship and Development of
IT and ITeS Industry in India

Dr. C. Paramasivan
1
& M. Selladurai
2

1
Assistant Professor
2
Research Scholar
1,2
Department of Commerce, Periyar E.V.R. College (A), Tiruchirappalli, Tamil Nadu

Abstract : Primarily, among numerous sectors of
the economy IT and ITeS industry is one whose
service is required for the rapid growth of the
economy and primarily the information technology
and information technology enables services sector
has covered the in-house development of the
nations’ infrastructure. In general, IT and ITeS
handles most of the official and unofficial
information. There is a lightning growth of Indian
software industry with the participation of global
corporate dominators for the past two decades.
Indian IT sector has contributed most in the
production and export of the software based
applications to all over the universe. This paper
highlights the growth and performance of IT and
ITeS and also examined the contribution and
development of IT and ITeS in Indian industry.
Key Words: IT and ITeS, IT industry in India,
Indian economy, Technopreneurship
Introduction
Information Technology is the acquisition,
processing, storage and dissemination of vocal,
pictorial, textual and numerical information by a
micro-electronics-based combination of computing
and telecommunications (Vijayasri, 2013).
Information Technology is an industry which
transforms the human’s multi skilled talents into
commercial one with the help of computers and
other supporting equipment. Till now the peoples
of the society believes that, Information
Technology is a corporate world deals with
computers only. But, the development in various
information delivery systems like Radio, TV,
Telephone, Newspapers, Internet and of course
Computers, information technology refers to the
entire frame of social media devices used to
communicate and transformation of information by
various target groups in the society. Information
Technology made a huge revolution in the field of
information and communication systems.
India is the world's major outsourcing
destination for the IT and ITeS industry with US$
124-130 billion market (67% of the global
production). The IT and ITeS also made some
significant demand in the Indian education sector,
particularly in engineering and computer based
graduates has employing 10 million workforces.
The Indian IT and ITeS has mainly classified into
four major segments - IT services; Business
Process Management (BPM); software products
and engineering services; and hardware (Meenu,
2016). The report of NASSCOM describes the
growth rate of IT sector is projected at a rate of 12-
14% for the financial year 2017-18 in currency
terms and it is expected to be triple in the year 2025
with US$ 350 billion.
IT Industry in India
The IT industry has built very valuable
brand equity for itself in the global markets. The
Indian IT Industry comprises of software industry
and information technology enabled services,
which even includes business process outsourcing
industry (Vijayasri, 2013). The first IT company in
India has established in 1970 with the entry of Tata
Consultancy Services into the domain for its
outsourced work. TCS began its outsourced work
to organizations like Central Bank of India and
Bombay Telephones. Within a few years TCS
began promoting young Indian engineers to a joint
trade partner in the United States for commercial
purpose. The trainee engineers were performed
excellent to complete their projects on time and
TCS started to expand their business outlets in
Germany, Korea and Japan. In later years, software
development and hardware development becomes
independent and software computing runs in its
own platform. This policy caused the production
and relocates its industry from Bombay to
Bangalore, Delhi, Chennai etc.,
These are the policies for the development
of Indian IT industry to compete with world-class.
Today, IT companies in India namely Tata
Consultancy Services, Wipro, Cognizant, Infosys,
HCL, Mahimatech were familiar in the global
marketplace for their IT proficiency. Indian IT
Industry's improvement and involvement in the
world's information technology sector holds the

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ISSN: 2454-1362, http://www.onlinejournal.in

Imperial Journal of Interdisciplinary Research (IJIR) Page 52

maximum participation. Metro Cities like Delhi,
Mumbai, Bangalore, Chennai and Hyderabad has
become the favourite places for all the big
corporates like HSBC, Dell, Microsoft, Hewlett
Packard and also for many Indian MNC firms have
set up their main offices in these top cities (Geetha
Vaidyanathan, 2007). These metro cities offers
good infrastructure with large floor space and high
speed telecom facilities. These were the major
reasons for the high growth of Indian IT sector and
this change turns the global companies towards
India.

Major IT Locations in India
Rank City Features and Prospects
1 Bangalore
Popularly known as the Silicon Valley of India and leading software exporter
from India. Bangalore is considered to be a global information technology hub of
India.
2 Chennai
Chennai is the second largest exporter of IT and ITeS of India and it is the BPO
hub of India. Chennai has the largest operational centres like TCS, Infosys,
Cognizant etc.
3 Hyderabad
Hyderabad is a major IT hub in India which is also known as Cyberabad which
consists of many MNC’s namely Google, Facebook, Microsoft, Amazon, Oracle,
Electronic Arts etc.
4 Mumbai
The Financial capital of India, but recently many IT companies have established
offices.
5 Delhi
The National Capital Region comprising Delhi, Gurgaon and Noida are clusters
of software development.
6 Pune
Major Indian and International Firms present in Pune. Pune is also CDAC
Headquarter.
7 Kolkata
The city is a major back-end operational hub for IBM, Texas Instruments, Intel,
Deloitte, Sun microsystems (Oracle).
8 Bhubaneswar
The capital city of Odisha, an emerging IT and education hub, is one of India's
fastest developing cities.
9 Thiruvanathapuram
The capital of Kerala, now houses all major IT companies including Oracle, TCS,
Infosys and contributes in IT export of India.

Review of Literature
Taranjit Singh and Batra (2014), had
criticized that the IT industry in India has attracted
its fair share of criticism. This was primarily
leveled against the industry's excessive political
influence - as articulated through its association,
NASSCOM - which, it is claimed, far exceeds its
economic contribution to the country. This has
allowed the industry to secure the support and
resources of the Indian state ahead of other sectors
of the national economy where the developmental
returns would be greater. According to the
Confederation of Indian Industry report, India's IT-
business process outsourcing industry’s revenue is
expected to cross US$ 225 billion mark by 2020.
Rahul Chattopadhyay (2016), had
explained the rise and growth of India’s IT
industry. In general, ITeS covers all aspects of
managing and processing information. The last
decade of 20
th
century has witnessed IT sector have
revolutionary effect of the humanity. In the last two
decades there is 20 times increase in export
revenues for the IT industry, employing over two
million people. Today the whole IT industry is
playing a major role in Indian economy and shows
how to analyse the growth and performance of
information technology industry in India. Various
aspects of information technology industry like
composition, revenue, exports, wealth creation, size
and share, localization etc. were studied.
Shreelatha and Bagali (2014), had
examined the acceptance of gender diversity
between employees and how the effect of diversity
management courses and practices has taken by
different IT companies and also investigates
influence of difficulties present in IT industry. The
population for the study comprises of employees
from Information Technology firms including IT
servicing companies and ITeS-BPO companies has
situated at Bangalore. With the help of focus group
interview and discussions with HR managers of
reputed companies, questionnaire was developed
by the researcher. The tool was found to be reliable
with advanced variables framed in questionnaire.
Growth of IT Industry in India
The IT and ITeS Industry in India has
grown quickly and earned a brand identity by its

3. Imperial Journal of Interdisciplinary Research (IJIR)
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ISSN: 2454-1362, http://www.onlinejournal.in

Imperial Journal of Interdisciplinary Research (IJIR) Page 53

huge software exports. The IT and ITeS industry
has two major components such as IT services and
Business Process Outsourcing. The development of
the service sector in India led by the software
sector contributing much more in nation’s income,
employment and exports. The metro cities like
Bangalore, Mumbai, Chennai, Delhi, Pune,
Hyderabad and Kolkata has records nearly 90% of
the software units export. India registers a gradual
increase in the total export of the IT and IT enabled
service throughout the year from the beginning.

Source: Compiled data of Software Technology Parks of India

It is revealed that the exports of IT and ITeS in the
year 2012-13 was Rs.2,51,497 crore and it has been
increased to Rs.2,73,313 in 2013-14. In the
following years of 2014-15 and 2015-15 was
Rs.2,93,797 crore and Rs.3,19,596 crore
respectively. The gradual and continuing growth in
the exports of the IT and ITeS leads India a master
blaster in the field of software based business. It
was successfully recorded the exports performance
over 200% from the year 2006-07 to the year 2015-
16. Finally, Indian IT and ITeS unit exports has
increased by Rs.3,19,596 crore in 2015-16 that was
increased by 8% as compared to last year.
State wise Software Exports made by registered units through STPI
(₹ in Crores)
Name of the State/UT 2015-2016 Name of the State/UT 2015-2016
Andhra Pradesh 477.93 Madhya Pradesh 355.00
Bihar 7.25 Maharashtra 64,063.59
Chandigarh 700.79 Odisha 2,179.72
Chhattisgarh 23.29 Puducherry 182.55
Delhi 1,442.30 Punjab 324.83
Goa 117.17 Rajasthan 803.97
Gujarat 2,224.55 Tamil Nadu 33,905.30
Haryana 19,265.44 Telangana 41,480.47
Karnataka 1,25,418.53 Uttar Pradesh 16,450.68
Kerala 3,008.91 West Bengal 6,990.00
Source: Software Technology Parks of India, Annual Report
Indian IT companies such as TCS, HCL,
Infosys and Wipro becomes so popular around the
world. Now-a-days Bangalore is called the Silicon
Valley of India because of its massive contribution
(40%) in the Indian IT and software exports. It
grabbed the head quarter of the India’s largest
companies. Mumbai placed second (20%) in the IT
and software exports with large number of MNC
companies like TCS, Cognizant, Capgemini,
Reliance, L&T Infotech, Patni, Naukri etc., within
144.214
180.155
207.358 205.505
215.264
226.712
251.497
273.313
293.797
319.596
0
50.000
100.000
150.000
200.000
250.000
300.000
350.000
2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
IT/ITeS Unit Exports (₹ in Crores)

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its surroundings. The other metro cities like
Chennai (11%) and Hyderabad (13%) too added
their participation in the IT and software exports
during the financial year 2015-16.
Government Initiatives
After the economic reforms of 1991-92,
major fiscal incentives provided by the
Government of India and the state governments
like liberalization of external trade, elimination of
duties on imports of information technology
products, relaxation of controls on both inward and
outward investments and foreign exchange, setting
up of Export Oriented Units (EOU), Software
Technology Parks (STP), and Special Economic
Zones (SEZ), has enabled India to flourish and
acquire a dominant position in world’s IT scenario
(Rahul Chattopadhyay, 2016).

The above statistic shows that, there was a
gradual and has no negativity in the growth in the
overall revenue of the IT and ITeS industry since
its first operation. The total revenue generated by
the IT and ITeS industry in India between the years
2008-09 and 2015-16. In the year 2013-14, a total
of US$ 106.3 billion of revenue was created by the
Indian IT industry, which was rejuvenated in the
year 2014-15 with massive wave of increasing
revenue by 132 billion U.S. dollars and it has raised
by over 25% when compared with last year. In
2015-16, the revenue generated by the Indian IT
and ITeS sector was 143 billion U.S. dollars. There
was an increasing trend with more than 200% in its
earnings of last eight years.
Conclusion
It is concluded that, the IT and ITeS sector
is the most wanted and highly contributed towards
the GDP of the nation. It should be developed from
its grass roots for the rapid growth of the economy.
However, this achievement can be attained by the
Indian IT industry by re-inventing itself through its
new trend of business models and make
partnerships with leading global corporates. India
welcomes investment from all over the universe to
operate the profitable business. This study points
out that, the revenue of IT was recorded about US$
143 billion in the year 2015-2016 and the share of
total Indian IT and ITeS unit exports has increased
by Rs.3,19,596 crore in 2015-16 that was increased
by 8% as compared to last year. India aspires to
transform itself into a truly developed and
empowered nation by 2020.

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