Software, Services Exports Register 43% Growth

India's global exports of computer software, services and electronics during the year 1998-99 have registered a growth of 43 per cent at Rs 17,775 crore. This was against the Rs 12,440 crore recorded by the Indian software industry during 1997-98. These were the findings of a study conducted by the Electronics and Computer Software Exports Promotion council (ESC).

The information technology sector has also registered an all-time high sectoral growth of 84 per cent.

According to the ESC report, the estimated exports in this sector rose to Rs 12,500 crore in 1998-99 against Rs 6,800 crore in 1997-98. During the year, 19 new countries were added for software export and the total number of countries for export of software has increased from 66 during 1997-98 to 85 during 1998-99, including a 26 per cent growth rate in market diversification.

 

According to the association, the total export of electronics hardware goods, including video software, is estimated at around Rs 2,475 crore, 18 per cent less compared with the figures for the year 1997-98. The association attributes this shortfall to the steep fall in the export of computer hardware items.

Exports from this sector, as per the association's study, are estimated at Rs 300 crore during 1998-99 compared with Rs 1,100 crore during 1997-98.

The telecom services and project export registered a marginal growth of 7.69 per cent for the year 1998-99 at Rs 2,800 crore compared with Rs 2,600 core during 1997-98.

According to the survey, destination-wise analysis reveals that North America (US and Canada) remains the country's largest market contributing Rs 7,683 crore or about 61.4 per cent of the country's total export earnings in this sector.

"The growth in this market in value terms is 98 per cent and in percentage share term is 7.73 per cent," the study says.

According to the survey, Europe (EC countries) continued to be the second largest market, with India's export of software estimated at Rs 3,180 crore compared with Rs 1,783 crore during the year 1997-98.

According to the survey, there is a need to initiate export promotion programmes in the markets of Australia and Aseanic countries.

India's exports to these markets have gone down from Rs 145 crore in 1997-98 to Rs 114 crore during the year 1998-99.

As per the survey findings, software exports under various schemes reveal that contribution in exports by units approved under the Software Technology Park of India scheme has been Rs 6,300 crore compared with Rs 3,389 crore during the year 1997-98.

Contribution of units operating under various export processing zones has gone up from Rs 790 crore in 1997-98 to Rs 1,140 crore in 1998-99, but the percentage share has gone down from 11.62 per cent in 1997-98 to 9.19 per cent during 1998-99.

"One of the factors responsible for this decline is that many of the units operating under EPZ scheme have been converted into STP units," the survey points out.

Y2K opportunities has contributed approximately Rs 2,800 crore about 22.4 per cent of the countries total exports during the year 1998-99. The survey also estimates that accumulated Y2K business till March 1999 has contributed approximately $1.2 to 1.5 billion.

As per the survey, IT enabled services is another important area and has contributed approximately Rs 1,250 crore, about 10 per cent of the export basket. It is expected that the e-commerce business itself would cross $ 1.5 billion by the year 2003 which is currently less than $4 million.

The Break-up

1998-99 1997-98

Total exports 17,775 cr 12,440 cr

No. of importing countries 85 66

STPI countribution 6,300 cr 3,389 cr

EPZ countribution 1,140 cr 790 cr

Destination to:

North America 7,683 cr

European Community 3,180 cr 1,783 cr

Australia & Aseanic 145 cr 114 cr