IT exports seen rising 26% to $12bn in FY04

Kiran Karnik, the president of National Association of Software & Services Companies (Nasscom), said IT exports were likely to rise by 26 per cent to touch $12 billion during the current financial year.

Of this, business process outsourcing services would account for $3.6 billion with the rest coming from IT-enabled services (ITES), he forecast.

Speaking to media persons on the sidelines of the two-day summit iTECH 2004, Karnik said the year 2003 proved to be a very good one for the IT industry with the global economy, especially US economy, looking up.

On the widespread concerns abroad, in US and UK, against outsourcing segment, he observed that BPO was one of economic necessity for both the economies, and the concerns would subside in time.

Nasscom was in fact pointing to a study that there would be a shortfall of 15 million jobs and the way out for developed countries was either to export services or import workers.

Nasscom also pointing to a McKinsey study that for each $1 worth outsourcing contract the value created was $1.47 and of it $1.12 was going to the outsourcing countries only.

In fact it was China which was robbing the bulk US manufacturing jobs, compared with a minuscule IT jobs going to India, he said, adding that 85 per cent of US economy growth was bring driven by the manufacturing sector alone.

To a query he clarified that the number of product-based companies was going up and in fact it doubled in the recent years. A product forum under Rajiv Modi of Sasken Technologies was set up to cater to their needs, he said, adding that Nasscom was seeking financial assistance from the government for patent filing by the Indian companies.

Nasscom is actively taking up a campaign 'India Inside' to apprise the companies worldwide of the benefits of doing business with the Indian IT industry.

On the concerns over the quality of BPO industry in the country, with some bringing bad reputation to the country, the Nasscom president said a standards system on the lines of that for IT companies was also being sought for the BPO industry.

In this regard, he mentioned the standards worked out by Satyam in coordination with Carnegie Mellon University. On the foreigners perception of India versus China, he said the biggest bottleneck was lack of good infrastructure, mainly transport for easy connectivity to the Indian cities.