Top IT hotspots in India

By Vipin Agnihotri

Bangalore is one of the hottest IT destinations of India. The ten-fold growth of Bangalore is basically due to the IT boom in last two or three years. Widely been regarded as the Silicon Valley of India, Bangalore is known for its information technology and information technology-enabled services. Software companies such as Infosys and Wipro is based in Bangalore. According to one estimate, Bangalore is responsible for more than 30 per cent of India's Rs 144,214 crore IT exports in 2006-07.

Similar to Bangalore, Hyderabad has also witnessed an IT boom in recent years. It is worthwhile pointing that software exports figure has crossed $1 billion in 2004. At present, Hyderabad is witnessing big investments in digital infrastructure. Few days ago, Indian government has given an approval to seven new projects,

Chennai is India’s third-largest exporter of information technology and information-technology-enabled services. In terms of infrastructure, Chennai has the potential to beat Bangalore and Hyderabad. According to experts, the software companies having their development centres in Chennai are well positioned to tap the growing healthcare market for IT products. Point to be noted here is that companies such as Tata Consultancy Services, Cognizant Technology Solutions and Covansys earn the lion's share of their income from what they offer to the US healthcare market.

Pune may soon become the number one destination for IT investments in India. I am confident in saying this because I have seen the pace at which city is growing and attracting companies. It is worthwhile pointing that Pune has the highest PC penetration among households. Number of IT majors such as Wipro, Infosys, Satyam, Tata Consultancy Services, Kanbay, Veritas, Cognizant, PCS and Mahindra British Telecom have development arms in the city.

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By Vipin Agnihotri

Tata Consultancy Services (TCS), India’s biggest IT services company third quarterly results in mid-January clearly show that North America still accounts for the bulk of TCS’s revenues at 49.5 per cent. On the other hand, Europe’s contribution to the company’s revenues has jumped to 28.5 per cent for 2007-08 from 23.1 per cent in 2004-05.

For TCS, North America grew at 2.2 per cent, UK at 4.9 per cent and Europe at 24.2 per cent. Similar is the case with other IT companies like Infosys, Wipro, Satyam and HCL Technologies. In my opinion, the push for growth in geographies other than the US is gathering steam. Most of the experts feel that Indian IT industry has been minimizing its dependence on the US.

According to sources, Satyam and Wipro is eyeing growth in markets like Japan, South Africa, India and China. The main reason behind all this is that the appreciating rupee against the dollar has made selling in the US less attractive. Furthermore, the majority of the contracts in the US market are second or third generation outsourcing contracts. Europe, on the other hand, is still relatively new to outsourcing.

In my opinion, Western Europe has been the fastest growing market for offshore for the last two years and is likely to continue to remain so for the next few years. Infosys like to see the US contributing half of the company’s revenues, Europe at 30 per cent and Asia-Pac (including Japan) at 20 per cent. Indian IT companies need to look at each market as a fresh market and create a customized model for that market.

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