Remote infra mgmt to be Rs 50,000cr industry

Indian remote infrastructure management (RIM) industry is positioned to cross the Rs 50,000 crore mark in the next five years, reveals a recent study by information technology (IT) industry body Nasscom and management consulting firm McKinsey.

Opportunities worth $26-28 billion (Rs1,02,700- 1,10,600 crore) will be realised globally in this space by 2013, says the study. Of the total amount realised India is poised to grow at compounded annual growth rate (CAGR) of 30% to capture over 50% of this market amounting to $13-15 billion (around Rs 51,350 crore to Rs 59,250 crore) by 2013.

The study further shows that almost 70-75% of the infrastructure management roles can be offshored, hence the total addressable market for this field is estimated to be $96-104 billion globally.

Till date however the vendors and captives in low-cost locations like India, Malaysia and Singapore have captured only $6-7 billion (Rs 23,700-27,650 crore) of this opportunity, leading to a huge opportunity for growth in the area. The Indian RIM market currently stands at over Rs 13,000 crore ($3.3-3.6 billion), however if the potential in this market isrealised, it could generate over 3.5 lakh jobs by 2013, says the study.

"Given its leadership in IT and BPO, India has a substantial head-start over other low-cost locations. Also, the rapid evolution in technologies and IT architectures, changes in customer behaviours and demand patterns, and developments in the vendor and offshore supply environment have propelled the industry at a pace faster than earlier conceived, and will continue to accelerate RIM adoption," says Vivek Pandit, partner, McKinsey and Company.

Som Mittal, president, Nasscom, said, "The Indian IT industry has been rapidly evolving with new specialised and value added offerings being delivered. Like IT and BPO, we see Remote Infrastructure Management as a large opportunity requiring focused attention and nurturing."

The study however points out that for India to sustain its leadership in offshoring and realise the full benefits of the RIM opportunity, issues of talent supply and quality, industry benchmarking, and security enforcement, amongst others.

It further says that there is the need for an independent body that can systematically audit and publish "vendor capabilities" in line with global benchmarks and best practices.