IT Industry in India

Hi Everyone,

So the IT Industry in India and its supremacy are reaching a plateau?? Its growing fast, how long, how fast, till when, these are a few of the questions that trouble the mind of an IT worker today.

I would like to share my views with you on this phenomenon so I will break this topic into some subtopics.

The first one is What started it all, what we did right to be here.

There are many things that went for India for it to become what it is today, am enlisting some of them here:

1) English speaking workforce

2) Close ties with the west, many Indians working in US and Europe. The immigration population in these countries is highly successful often in leading and decision making posts, so when the time came to outsource they looked at India. More or less following the trend when one brother who owns a retail store in US looks to his brother in India to supply him cheap goods to sell.

3) Availability of cheap labour (qualified cheap labour) well the IT industry just 5 Years back was the same as any other industry and people earned a pittance working for days and nights together. The skill level was good enough for low level programming, testing and web site jobs also for Y2K resolution.

4) Onsite lure: Most indian companies just started as Manpower consultants, sending people to US to work for US MNCs but this had a big impact. The people who worked with these MNCs brought back crucial process, product, managerial and technical knowledge to enable the Indian Companies to do business out of offshore. So the Manpower consulting companies had a very big hand in taking India in IT to where it is today.

5) Lack of opportunities: IT provided the much needed opportunity to youngster's here to get a job and a decent standard of living (at a time when getting a job itself was difficult).

6) Indian Currency (Re): The rupee was favourably placed for us to be able to export and get benefits of labour arbitrage.

7) Government Incentives: IT was one field where you had STPI benefits, Income Tax Exemption and this played a key role in making india an IT Destination.

8) Downturn in US Economy: The US Economy downturn actual helped India as companies in US looked at cost cutting and started offshoring. Loads of MNCs set up their shops in India to save costs and thus maintain their margins.


Hmm, so these are some of the reasons that India emerged as an IT power. Now many of these factors have gone against us and there are new threats emerging fast. Will discuss this in the following post What Ails Indian IT Industry and then would follow it up with what we can do to save ourselves from getting Shanghaied.

Till then happy coding.