Information technology in India

Information Technology in India is an industry consisting of two major components: IT services and business process outsourcing (BPO).^[1] The sector has increased its contribution to India’s GDP from 1.2% in 1998 to 7.7% in 2017.^[2] According to NASSCOM, the sector aggregated revenues of US$180 billion in 2019,^[3][4] with export revenue standing at US$99 billion and domestic revenue at US$48 billion, growing by over 13%. As of 2020, India’s IT workforce accounts for 4.36 million employees.^[5] The United States accounts for two-thirds of India’s IT services exports.^[6]

History[edit]

India’s IT Services industry was born in Mumbai in 1967 with the creation of Tata Consultancy Services^[7] who in 1977 partnered with Burroughs which began India’s export of IT services.^[8] The first software export zone, SEEPZ – the precursor to the modern-day IT park – was established in Mumbai in 1973. More than 80 percent of the country’s software exports were from SEEPZ in the 1980s.^[9]

Within 90 days of its establishment, the Task Force produced an extensive background report on the state of technology in India and an IT Action Plan with 108 recommendations. The Task Force could act quickly because it built upon the experience and frustrations of state governments, central government agencies, universities, and the software industry. Much of what it proposed was also consistent with the thinking and recommendations of international bodies like the World Trade Organization (WTO), International Telecommunications Union (ITU), and World Bank. In addition, the Task Force incorporated the experiences of Singapore and other nations, which implemented similar programs. It was less a task of invention than of sparking action on a consensus that had already evolved within the networking community and government.

Regulated VSAT links became visible in 1994.^[10] Desai (2006) describes the steps taken to relax regulations on linking in 1991:

In 1991 the Department of Electronics broke this impasse, creating a corporation called Software Technology Parks of India (STPI) that, being owned by the government, could provide VSAT communications without breaching its monopoly. STPI set up software technology parks in different cities, each of which provided satellite links to be used by firms; the local link was a wireless radio link. In 1993 the government began to allow individual companies their own dedicated links, which allowed work done in India to be transmitted abroad directly. Indian firms soon convinced their American customers that a satellite link was as reliable as a team of programmers working in the clients’ office.

A joint EU-India group of scholars was formed on 23 November 2001 to further promote joint research and development. On 25 June 2002, India and the European Union agreed to bilateral cooperation in the field of science and technology. From 2017, India holds a Associate Member State status at CERN, while a joint India-EU Software Education and Development Center will be located in Bangalore.^[11]

Contemporary situation[edit]

In the contemporary world economy, India is the largest exporter of IT. Exports dominate the Indian IT industry and constitute about 79% of the industry’s total revenue. However, the domestic market is also significant, with robust revenue growth.^[2] The industry’s share of total Indian exports (merchandise plus services) increased from less than 4% in FY1998 to about 25% in FY2012. The technologically-inclined services sector in India accounts for 40% of the country’s GDP and 30% of export earnings as of 2006, while employing only 25% of its workforce, according to Sharma (2006). According to Gartner, the “Top Five Indian IT Services Providers” are Tata Consultancy Services, Infosys, Wipro, Tech Mahindra, and HCL Technologies.^[12]

Major information technology hubs[edit]

Bangalore[edit]

As of fiscal 2016–17, Bangalore accounted for 38% of total IT exports from India worth $45 billion, employing 10 lakh people directly and 30 lakh indirectly.^[13] The city is known as the “Silicon Valley of India”.^[14][15] Notable tech parks are Electronic City, ITPL, Bagmane Tech Park, Embassy Golf Links, Manyata Tech Park, Global Village Tech Park, Embassy TechVillage. Apart from these IT companies are also located in several other parts of the city. Notable IT companies of the area include Infosys, Wipro, HCL Technologies, SAP Labs, Accenture, TCS, Oracle, IBM India, Sonata Software, Mindtree, and Intuit India.^[16][17]

Bangalore is also known as the “startup capital of India”; the city is home to 44 percent of all Indian unicorn startup companies as of 2020.^[18]

Chennai[edit]

As of 2012, Chennai is India’s second-largest exporter of information technology (IT) and business process outsourcing (BPO) services.^[19][20] Tidel Park in Chennai was billed as Asia’s largest IT park when it was built.^[21][22] Notable tech parks are International Tech Park, DLF Cybercity SEZ, Mahindra World City, SIPCOT IT Park, Olympia Tech Park, One Indiabulls Park, L&T Estancia IT SEZ and Ramanujan IT City. City has an expressway called as IT expressways and a preferred location for IT industries. Major software companies such as Tata Consultancy Services, Infosys, Zoho, Capgemini, Cognizant Technology Solutions, Accenture, UST Global, BirlaSoft, HCL Technologies have their offices set up here, with some of them making Chennai their largest base.^[20]

Hyderabad[edit]

Hyderabad – known for the HITEC City or Cyberabad – is a major global IT hub, and the largest bioinformatics hub in India.^[23][24] Hyderabad has emerged as the second largest city in the country for software exports pipping competitors Chennai and Pune.^[25][26][27] As of 2020, the IT exports from Hyderabad was ₹128,807 crore (US$15 billion), the city houses 1500 IT and ITES companies that provide 582,126 employment.^{[28][29][30][31]} Notable tech and pharma parks are HITEC City, Genome Valley, and Hyderabad Pharma City

Kochi[edit]

InfoPark, Kochi is an information technology park situated in the city of Kochi, Kerala, India. Established in 2004 by the Government of Kerala, the park is spread over 260 acres (105.2 ha) of campus across two phases in Kakkanad region of Kochi City, housing 450 companies which employ more than 50,000 professionals as of 2020. Infopark Phase 1 is spread over a 101 acres (40.9 ha) campus with more than 6,000,000 sq ft (557,400 m2) of operational built-up space and is expanding further. Infopark Phase II is spread over 160 acres (64.7 ha) of campus which would have a total built-up space of 8,000,000 sq ft (743,200 m2) upon completion and would employ close to 80,000 professional. The notable tenants in the park include Indian Technology giants like Tata Consultancy Services, Cognizant, Wipro, HCL, UST Global, Suyati Technologies, IBS Software Services etc. and foreign corporations like KPMG, Ernst & Young, IQVIA, EXL Service, Etisalat, Hubbell, Northgate, Nielsen Audio, Xerox, Conduent etc.

SmartCity, Kochi is a joint venture started by a company named Smart City (Kochi) Infrastructure Pvt. Ltd. which was formed by Government of Kerala (16% holding) and Dubai Holding (84% holding) to implement the project. The project is spread over an area of 246 acres (99.6 ha) and envisions a minimum 8.8 million sq ft of built-up space out of which at least 6.21 million sq ft will be specifically for IT/ITES/allied services. The project is expected to create over 90,000 direct jobs.

Kochi is one of four Indian cities connected to the rest of the world by undersea fibre-optic cables, the other three being Mumbai, Chennai and Tuticorin.

Kolkata[edit]

Kolkata is the financial and business hub of Eastern India. The metro city has seen a significant rise in IT services. In August 2018, the West Bengal Government has announced that 200 acres of land in Rajarhat Newtown will be used for the development of Bengal Silicon Valley, similar to the California Silicon Valley in San Francisco, USA.^[32] The main intention of this project is to create a business-friendly environment for IT companies to set up their business in the city. Major IT Parks include Sector V, DLF 1,2,Gitanjali Park SEZ, Ecospace .

Pune[edit]

The Rajiv Gandhi Infotech Park in Hinjawadi is a ₹600-billion (US$8.9 billion) project by the Maharashtra Industrial Development Corporation (MIDC).^[33][34] The IT Park encompasses an area of about 2,800 acres (11 km²) and is home to over 800 IT companies of all sizes.^[35] Besides Hinjawadi, IT companies are also located at Magarpatta, Kharadi, Yerawada, Aundh and several other parts of the city. As of 2017, the IT sector employs more than 300,000 people.^[35][36]

Delhi NCR[edit]

Delhi NCR is one of the major IT hub in India. Cities like Gurugram and Noida have several companies thats serves the local and global markets. ^[37]

Bhubaneswar[edit]

Bhubaneswar in Odisha is one of the fastest growing IT hubs in India and is also known as “IT hub and Startup hub of Eastern India”.^[38][39]According to a 2012 survey, Bhubaneswar has been chosen as the best for conducting IT/ITES business among the tier-2 cities in India. It is the only destination in Eastern India where all 4 major IT giants of India such as Infosys, Wipro, TCS & Tech Mahindra have set up their development centres. It was among the first three cities along with Pune & Bengaluru to receive STPI centres in 1991. Infosys set up it’s first offshore development centre in Bhubaneswar outside Karnataka in 1996.^[40] In 2018, National Informatics Centre established its 4th data centre in Bhubaneswar apart from New Delhi, Pune & Hyderabad.^[41]

There are several IT Parks located in Bhubaneswar such as Infocity-1, Infocity-2, STPI-Bhubaneswar, JSS-STP,^[42][43] DLF Cyber City.^[44] Several IT Companies like Infosys, Tech Mahindra, TCS, Wipro, IBM, Genpact, Firstsource, Mindtree, MphasiS, Ericsson, Semtech, Capgemini,^[45] Reliance Communications and some 300 Small and Mid-Size IT companies and Business Startups are present in Bbsr. The Government of Odisha is developing ”Info Valley” in the outskirts of this city into an international IT hub. Spread over 730 acres, it is to promote investment in IT, Electronic manufacturing, and IT SEZ. The Park has been developed with an investment of ₹ 203 crores & has an employment potential of 10,000 – 12,000 jobs, which will be a mix of skilled and semi-skilled personnel. The proposed greenfield cluster will encompass common facilities for production support services like tool room, test & measurement labs, incubation and training centres, and also would have provisions for common infrastructure support like power, water and ETP for the potential investors. Meanwhile, Infosys had started construction of its second campus in the IT park of Info Valley.^[46][47][48]

Visakhapatnam[edit]

The ITES and IT sector is growing at its pace in the city of Visakhapatnam, the generated revenue from these sectors are a boon to the economy.^[49] The IT special economic zone and incubation center exists at Rushikonda Hills, of the city. There are many national and multi–national IT/ITes and banking firms such as Mahindra Satyam, Pulsus Group,^[50][51] Wipro, Kenexa, Infotech, IBM, Sutherland, and HSBC etc. Software exports from Visakhapatnam have increased by nearly 90% each year.

The IT exports from the city for 2012 were ₹1,200 crore and 16,000 people were employed. According to data released by the state IT department for the financial year 2012–13, IT industry registered an impressive in IT/ITES revenues, that generated ₹1,445 crore (US$200 million), an increase of 20%, compared to the previous financial year. The same year saw an increase in employment, generated by the IT/ITeS industry, with 20000 jobs as compared to 16,000 in 2011–12 period.^[52] The Information Technology Investment Region (ITIR) project, planned by the Government of Andhra Pradesh, may generate employment to approximately, up to 15 lakh IT professionals and also the it can generate revenue for the economy, of up to ₹3.11 crore (US$440,000).^[53]

Govt of AP plans to convert Vizag city into an IT hub made many new investments from Multi-National Companies. Many firms such as Google, Tata Consultancy Services, Microsoft, Uber, Pulsus Group, Adani Data Center, Capgemini, Accenture etc. have accepted to set their office locations in Vizag.

There are many national and multi–national IT/ITes and fintech firms such as IBM, Wipro, Pulsus Group, Tech Mahindra, Kenexa, Infotech, Conduent, Cyient, Paytm, Concentrix, Sutherland, HSBC, etc. Some more investments are in line, like Google x, Lalith Ahuja’s ANSR Consulting, Franklin Templeton, Innova Solutions, etc. at Fintech Valley in the city.^[54][55] Conduent has highest employees in India, third largest outside United States and operating from NCR (Noida and Gurgaon), Bangalore, Hyderabad, Kochi and majorly from Visakhapatnam. ^[56][57]