The contribution of India's IT industry to economic progress has been quite significant.

The rapidly expanding socio-economic infrastructure has proved to be of great use in supporting the growth of Indian information technology industry. The flourishing Indian economy has helped the IT sector to maintain its competitiveness in the global market. The IT and IT enabled services industry in India has recorded a growth rate of 22.4% in the last fiscal year. The total revenue from this sector was valued at 2.46 trillion Indian rupees in the fiscal year 2007. Out of this figure, the domestic IT market in India accounted for 900 billion rupees. So, the IT sector in India has played a major role in drawing foreign funds into the domestic market http://www.economywatch.com/india-it-industry/economic-progress.html

IT, ITEs Contribution To GDP To Go To 7% With BTO Size Estimated At $ 680 Billion By 2009 | INRnews
New Delhi, December 20, 2006 - The contribution of IT and ITEs to national GDP will rise to 7% by 2007-08 against 4.8% in 2005-06 and the market potential for Business Transformation Outsourcing (BTO) is expected to be around $ 680 billion towards the end of March 2009, according to Secretary, Information Technology, Mr. Jainder Singh. Releasing ASSOCHAM Study on Business Transformation Outsourcing (BTO) : Third Generation Outsourcing at ASSOCHAM organised Summit on BPO/ITEs here today, Mr. Singh that IT and ITEs which grew at CAGR rate of 28% in the last 5 years, creating employment for 12.87 lakhs of skilled people will attain a growth rate of over 35% in next few years. The IT software exports which grew at 32% during 2005-06 had a growth rate of 23.4% in the last couple of years, said the IT Secretary adding that IT and ITEs will record over 40% growth rate with KPO and BTO services making an aggressive dent into IT sector. The concept of BTO is new to India in particular. Its growth rate, estimated in most pessimistic form is expected to be around 5%. But as BTO gains popularity and vendors become more mature in providing these services, it is expected to grow at 9 to 10% per annum. The market potential for BTO is expected to be around $ 680 billion by 2008-09. Also the percentage of BTO services in the outsourcing spectrum is expected to increase from 19% in 2004 to 31% by 2009, said Mr. Singh. As per ASSOCHAM Study, the city of Bangalore and Gurgaon have respectively been given 1st and 2nd ranking followed by Delhi and Chennai whose rank have respectively been placed at 3 and 4. Mumbai has been given fifth ranking position for future BTO hub as against Kolkata and Pune that has been placed at 6th and 7th ranking. For the potential BTO market, the industry gave mix response in its feedback to ASSOCHAM. According to some leading outsourcing companies like Genpact, the potential market of BTO services is as huge as $500 billion (measured across supply chain, engineering, design services, human resource management and customer care etc) & could become $680 billion by; while Transworks estimates its market potential, within the country, to increase from $2.5 million in 2004 to $7 billion by 2007 and Salient BPO estimates it to increase from $2.36 billion in 2004 to $5.64 billion in 2009. The growth rate of this market is estimated to be around 9% compounded annually. 24/7 Customers estimates it to be less then 5% in its nascent stages but is expected to grow at 10-15% in the next few years. Speaking on the occasion well known BPO expert, Mr. Raman Roy, CMD, Quatrro BPO Solution said that the IT and ITEs business transactions would touch $ 173 billion by 2007 globally of which USA will have the largest component in it with approx. 40% share. Indias contribution to the projected target will be to the extent of 4%. Mr. Roy wondered that with 4% penetration, how the BPO industry has come to saturation and projected that this industry will remain a lead player and contribute a great deal to the national GDP if harnessed properly. Mr. Umang Das, Chairman, ASSOCHAM BPO Council in his observations said that business players such as GENPACT, 24/7 Customer, Mcrop Global, Trnaswork Information, Stracon Back Office Solutions, NeoIT, Sailent Business Solutions, Vertex, Avaya Global Connect will be among the leading players that will establish a lead in BTO transactions in India in next few years as most of them have already made a mark in it.

By INRnews Correspondent

http://www.inrnews.com/news/articles/india/economy/it_ites_contribution_to_gdp_to. html

Bill Gates: Technology investments will make India an economic and software superpower
The time is now for investment in education, Internet infrastructure, packaged software development and intellectual property to ensure India's future

Mumbai, 5, March, 1997 On the occasion of his first ever visit, Mr Bill Gates, Chairman & CEO of Microsoft Corporation, called on India to harness the power and potential of personal computers to lead the country into the twenty first century. In a series of meetings in New Delhi and Mumbai with business leaders, opinion leaders, educators, personal computer users, media and policy makers, Mr Gates outlined a number of imperatives that will enable India to make the necessary transition to the global networked economy. "To be a leader in the digital economy of the twenty first century, India must invest in basic infrastructure, education and information technology," said Mr Gates. "These are the tools which will drive the country into the future and make India an economic and software superpower." "The country's advantages are many. India has an excellent university system. Its computer scientists are among the leaders of companies worldwide. Its technology centres in Bangalore, Pune and other places are well respected," Mr Gates continued. "India has what it takes to participate in, even to shape, the future if it makes the necessary investments now. It must build a national telecommunications infrastructure, develop a robust domestic software industry, provide Internet connectivity for the consumer and continue to invest in education." Sanjay Parthasarathy, Regional Director, Indian Subcontinent Region, Microsoft Corporation, said "Microsoft is investing in the Indian IT industry as a whole, transferring skills, intellectual assets and a new business model to a country which we believe can have a tremendous impact on the world IT market. We are working with a whole range of partners such as hardware companies, software developers, schools, colleges and policy makers to help build a world class IT infrastructure in India." Mr Gates delivered speeches to several forums in New Delhi and Mumbai during the course of his visit. [Note to editors: Transcripts of selected speeches made by Mr Gates will be available within two days following the event. Media Alerts are also available for each of the events. For all press information contact the Microsoft India Press Office at Text 100, details shown below.] New Delhi, 4 th March 1997: Press conference: The Future is Now! Mr Gates addressed a press conference in the capital at which he outlined the steps India needs to take now in order to participate in the global networked world. Mr Gates spoke about the need for

India to make the right investments in education, technology infrastructure and the Internet to make India a world software leader, and explained why India is one of the top three countries in the world for Microsoft's investments in 1996-1997. He also outlined Microsoft's product strategy explaining how the company has the best and most integrated software for desktop PCs, the Internet and corporate networks. Education Event: Investing in the Future, Now! Education was the theme of this event co-hosted with the Indian Institute of Technology (IIT), Delhi. Mr Gates discussed the importance of education as the engine of growth for the Indian IT industry and also highlighted the benefits of using computer technology for improving the quality and delivery of education at all levels. He outlined world-wide trends in the IT business, how education is core to the industry's success and described what Microsoft is doing in India in four education segments: university level computer science education, training for IT professionals, computer education in schools and career-oriented education. Mr Gates demonstrated the company's commitment to education by launching Microsoft India's'University Advanced Technology Labs Programme' (UATL) at five Universities. The UATL at each of the institutions will include the establishment of an Advanced Technology Lab for research and projects, access to Microsoft Windows NT source code to the Universities for research purposes, establishment of an instruction development center and an on-line training resource centre. Mr Gates said that Microsoft's investment in the UATL programme would have a market value of up to INR 35 million over a three year period. Stressing that India can be the largest source of trained manpower for the global IT industry, Mr Gates made an award to the 1000
th

Microsoft Certified Professional (MCP) in India.

He also awarded prizes to the eight winners of 'Microsoft Imagine the Magic' contest. The contest, run in association with Compaq, Living Media and United Airlines, sought to uncover the most creative and imaginative minds in India by asking children aged 8 to 18 what the most amazing computer could do. The contest focused on the power of the computer to help people create new things - new businesses, new products, new ideas, new ways for people to work together. "Unleashing creativity at all levels will be the mark of the future use of computers," said Mr Gates. The winners, chosen from over 40,000 entries, displayed a tremendous level of creativity, energy and vision. Confederation of Indian Industry Address In an address to over one thousand business leaders and policy makers at a meeting of the Confederation of Indian Industry (CII), Mr Gates highlighted two ways in which information technology in India can increase employment and boost economic growth: by increased organisational efficiency and by building a successful domestic IT industry. Mr Gates stressed that information technology is a basic infrastructure. "It is as important to a country's development in the Information Age as electricity has been in the twentieth century. Properly deployed, IT increases jobs and helps the economy grow. In the US, the fastest growing industry, and the greatest job creator, for the last ten years has been in the computer industry. Businesses in other industries that have adopted advanced technologies, along with solid training, have seen productivity improvements and a greater ability to compete." Computer technology, and now Internet technology, allows businesses to compete effectively anywhere in the world, as India's software industry is already beginning to show. IT reduces costs and lowers barriers to entry into markets. He said that organisations around the world deploying advanced technology are more able to compete and win in local and global marketplaces. This grows

businesses and produces jobs. Mr Gates called on CII to take the lead in connecting up its offices worldwide and encouraged the its members to connect to the CII network. Mr Gates also called for the establishment of a group within the organisation to focus on IT issues and drive the establishment of an IT Excellence Centre and create programs to increase awareness of the effective use of IT in Indian companies. Mr Gates stressed that India needs to invest in and protect intellectual property if it is to develop a strong local packaged software industry, by ensuring that local software developers get enough return on investment to continue to grow. Mumbai, 5 th March 1997: Bharatiya Vidya Bhavan Address: Social Impact of Computing Addressing the Bharatiya Vidya Bhavan (BVB) at the Tata Memorial Hall in Mumbai, Mr Gates, in the audience of the Prime Minister H.D. Deve Gowda, business leaders and senior government officials, described the positive role that computer technology can play in society. During his speech, Mr Gates spoke about the ways in which IT has made a positive impact on the basic quality of life and how computers can add to the fabric of society. Mr Gates said that the Internet and the personal computer are tools which can be used to bring a wide variety of information, on subjects ranging from advanced farming techniques, to precise weather patterns, to improved medical information enabling healthcare for the masses. "Far from alienating people, computer technology is becoming an efficient mechanism for bringing communities around the world closer together by allowing people to share intellectual resources," Mr Gates added. He stressed that from the standpoint of social services, IT makes it possible to provide services more quickly and easily and at lower cost. It allows the same number of people to provide more services. This is important to government, since most public institutions worldwide are expected to deliver more services. And governments will be among the leaders in deploying Internet-based solutions to provide better "customer" (citizen) services. This was a prime topic at the recent World Economic Forum in Davos, Switzerland, attended by India's Prime Minister as well as 100 other top leaders in the world. Mr Gates said that private industry and government both have a role to play in ensuring that the social benefits of personal computers reach the most needy sections of society and urged industry to take the lead in ensuring that IT can be used to create new jobs and enable the unemployed to get these new jobs. He announced that Microsoft will contribute software valued at INR 5 million to BVB for its computer education and training centers . Microsoft's donation to the BVB computer education centre is intended to enhance the success of BVB's already successful efforts to equip unemployed people with the skills needed to find jobs. Industry Leadership Summit Mr Gates made the keynote address at the Industry Leadership Summit co-hosted with NASSCOM (National Association of Software and Service Companies). The summit addressed issues facing India's estimated 160,000 software developers. During his speech, Mr Gates described the technology changes that will impact Indian software developers over the coming years, stressed the importance of the Internet, and suggested a course of action for software companies to compete and win on the world stage. He Gates showed how the Microsoft Windows platform has evolved over the years and will remain the best and most versatile platform for developers building applications for the PC, networks,

multimedia and the Internet. Mr Gates issued a call to action to the Indian software industry: make the transition from project oriented development to packaged products; develop applications for the local market and local needs; invest in research and development (R & D) and developing Intellectual Property; use the Internet to market globally; and prepare for intense competition. RAMCO Marshall 3.0 launch Mr Gates addressed a press conference to mark the launch of the RAMCO Marshall 3.0application. Marshall, a business computing applications suite

built

around the Microsoft Windows NT

™Server operating system and Microsoft SQL ™ Server database, is a client server system which can be used to build solutions for functional areas of a business such as accounting, sales, inventory and production. Mr Gates pointed out that RAMCO is a prime example of Microsoft's business model with software developers, based on building strong relationships with local partners. He stated that strengthening partnerships, in particular, helping Indian companies such as RAMCO to build world class software applications, is a key strategy for Microsoft in India. The Enterprise Tomorrow, Today This forum, co-hosted with Microland, examined the computing issues facing large organisations and was attended by Chief Information Officers and Chief Executives of Indian organisations. Mr Gates spoke about a number of trends in corporate computing and how Microsoft's vision has allowed the company to stay ahead of the competition. Mr Gates explained the concept of the 'PC Success Loop' where the reduction in prices of personal computers leads to volume sales which in turn promotes software development and innovation, further driving prices down and functionality upwards. The same 'Success Loop' is now happening at the server level, due to innovative software such as Microsoft Windows NTand Microsoft BackOffice ™ and dramatic improvements in hardware from companies like Compaq and Intel. Mr Gates said two focus areas for Microsoft are the Intranet and reducing the cost of ownership of IT systems for corporate users. Mr Gates talked about how the Microsoft Windows NT Server network operating system has emerged as the world's best-selling server operating system. With its ease of use, ability to run server applications and its built-in Web server, Internet Information Server (IIS), Windows NT Server is the leading platform for Intranets and the Internet. Microsoft Corporation India Private Ltd is a subsidiary of Microsoft Corporation USA. It has had a presence in India since 1987 and currently has offices in New Delhi, Bangalore and Mumbai. Founded in 1975, Microsoft (NASDAQ "MSFT" ) is the world-wide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day. For further press information please contact : Microsoft India Press Office Text 100 India Tel: 011 336 6880, 011 336 7080, 011 336 7088 Email: textind@giasdl01.vsnl.net.in

http://www.microsoft.com/presspass/press/1997/Mar97/bombay.mspx

The success story of the Indian IT industry has been told over and over again. However, it is far from over. It was yet another year of excitement and triumph for the IT corporates. While Oracle's acquisition of i-flex reinforced the importance of Indian IT industry, TCS and Infosys together put the country's IT scenario on the global platform by bagging the prestigious $400 mn ABN Amro deal. Forecasts are also encouraging for the sector. IT exports are likely to grow by 30-32% (in dollar terms) for the financial year 2005-06 and are expected to touch $50 bn by 2008 from the present $20 bn. By 2010, the sector is expected to contribute 7% to the country's GDP compared to the present 3%. Since it's raining profits everywhere, investments and expansions seem to be the in-thing for the industry. An action-packed year The year 2005 and 2006 were very eventful for the Indian IT industry.It was marked by a slew of expansion plans, mergers and acquisitions, new start-ups, and extensive changes in business models by both domestic and foreign companies. On the domestic front, industry biggies like Infosys, Wipro, HCL Tech, and Satyam, set up their branches and subsidiaries abroad. TCS entered the UK insurance and pension market by bagging a deal worth $847 mm from Pearl Group, the biggest one ever for an Indian company. Also, among the mid-rung companies, i-flex, Mphasis, Mastek, Cognizant, Tata Tech, Infotech, and Patni computers are some of the companies that made overseas forays in order to build or strengthen their footprints in the world market and enter new areas of business. At the same time, enthused by the growth opportunities in India, several MNCs also have either increased their presence or have set up shop in India. iNautix, a provider of global technology solutions, HID Corp, the US-based access control cards major, Aspire Systems, which develops technology products, Verisign, the network and Internet infrastructure service provider, to name a few, have entered India during the last year. Apart from these, global IT giants Microsoft, Intel, AMD, Semindia, Cisco, and Flextronics have made announcements that they will make investments of up to $8 bn in the next 3-5 years. The data of Infosys is shown as

follows:-