The information technology (IT) industry has been a significant foreign exchange earner for India in recent years. It has experienced substantial growth due to outsourcing projects and software exports, contributing significantly to the country’s foreign exchange earnings.
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The information technology (IT) industry has emerged as a major foreign exchange earner for India in recent years, contributing significantly to the country’s economic growth. This industry has played a pivotal role in India’s journey towards becoming a global technology hub.
According to a report by the National Association of Software and Service Companies (NASSCOM), the Indian IT industry accounted for approximately 8% of the country’s total exports in the financial year 2020-2021. It has been a key driver of India’s foreign exchange earnings, with software services and IT exports witnessing substantial growth.
Outsourcing projects have been a significant contributor to this growth. Many companies from around the world, attracted by the availability of skilled IT professionals in India and cost advantages, outsource their IT and software development projects to Indian firms. This has led to an influx of foreign investments and a rise in export revenues for the country.
In addition to outsourcing, software exports have also played a crucial role in India’s foreign exchange earnings. Indian IT companies have been at the forefront of exporting software products and services to global markets, catering to diverse industries such as banking, healthcare, e-commerce, and telecommunications. This has not only generated substantial revenues but also positioned India as a global leader in software development and IT services.
Highlighting the significance of the Indian IT industry, Nandan Nilekani, co-founder of Infosys, once stated, “The Indian IT industry has demonstrated its resilience and adaptability, becoming a vital cog in India’s economic growth story. It has not only contributed significantly to foreign exchange earnings but also played a key role in creating employment opportunities and fostering innovation.”
Interesting facts about India’s IT industry:
- The Indian IT and business process management (BPM) industry generated approximately $194 billion in revenue in the financial year 2020-2021.
- India has over 4,000 technology startups, making it one of the world’s largest startup ecosystems.
- Bangalore, also known as the “Silicon Valley of India,” is home to many multinational IT companies and startups.
- The Indian IT industry employs over 4.5 million people directly and indirectly, making it one of the largest employment generators in the country.
- The Indian government has taken several initiatives to promote the growth of the IT sector, including the establishment of technology parks and special economic zones.
Here is a table showcasing the growth of India’s IT exports over the last few years:
| Year | IT Export Revenue (in billion USD) |
|---|---|
| 2017 | 126 |
| 2018 | 137 |
| 2019 | 150 |
| 2020 | 157 |
| 2021 | 166 |
Please note that the figures mentioned in the table are for illustrative purposes only and may not reflect the exact values.
A video response to “Which of the following industries has been a major foreign exchange earner for India in the last few years?”
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Information Technology industry
The industry that has earned our country a major, sizeable share of foreign exchange, is the Information Technology industry. In the last two decades, the contribution to India’s GDP from Information Technology, has grown by 6.5%.
The industry that has earned our country a major, sizeable share of foreign exchange, is the Information Technology industry. In the last two decades, the contribution to India’s GDP from Information Technology, has grown by 6.5%.