February 25, 2022
Exports witnessed a growth of 17.2% and accounted for a revenue of US$ 178 billion
The e-commerce segment recorded a growth of 39% and accounted for US$ 79 billion
India, with its technology workforce of 5 million, has emerged as a global hub for digital talent
Over 70% of the CXOs believe that the technology industry will continue to grow in FY2023 and the industry will achieve its target of US$ 300-350 billion by FY2026
Driven by accelerated global tech spending, the Indian technology sector recorded an overall growth rate of 15.5% and reached a revenue of US$ 227 billion – an increment of US$ 30 billion. This upswing was also supported by the rapid growth of 9.2% in the Indian economy, as per Nasscom’s Strategic Review 2022.
This is the highest ever growth since 2011 as all industry sub-sectors witnessed a double-digit expansion. Exports (including hardware) witnessed a growth of 17.2% accounting for a revenue of US$ 178 billion – which is over 51% share of India’s total services exports.
In addition, India’s digital infrastructure played a key role in driving India’s technology adoption as the public digital platforms served as the foundation for India’s digital advantage. This increased the domestic demand as it reached approximately US$ 50 billion. The e-commerce segment recorded a growth of 39% and accounted for US$ 79 billion, while the share of digital revenue stood at 30-32%, logging an incremental revenue of US$ 13 billion in 2021-22.
India, with its technology workforce of 5 million, has emerged as a global hub for digital talent. The industry recorded a growth of almost 10% as it added approximately 450,000 people to its employee base. The digital technology talent pool is at 1.6 million and is growing at a CAGR of 25%. In addition, the Indian technology industry reskilled approximately 280,000 employees in FY2022. In addition, with over 36% – or 1.8 million – women employees, the Indian technology industry is one of the largest private-sector employer of women in India, with approximately 200,000 women expected to be added to the workforce in FY2022.
India is the third-largest start-up hub in the world with over 25,000+ tech start-ups, 42 new unicorns, and 11 initial public offerings (IPOs) in 2021. Over 2,250 tech startups were founded in 2021 and a record US$ 24 bn was raised in funding, with SaaS-based companies securing funding worth US$ 4.5 billion. In addition, the emphasis on intellectual property (IP) creation has resulted in India being ranked 46th in the Global Innovation Index, with the technology sector accounting for 138,000 patent applications during 2015-2021.
Despite uncertainties like geopolitics, macroeconomic fluctuations, supply chain disruptions, and the after-effects of the pandemic, it is expected that the industry will continue to display resilience. As per Nasscom’s Tech CEO Survey 2022, over 70% of the CXOs believe that the technology industry will continue to grow in FY2023 as the industry is well-positioned to achieve its target of US$ 300-350 billion by FY2026 growing at a rate of 11-14%. Revenue growth will be driven by strong deal pipelines and investments in the healthcare, banking, manufacturing, and retail sectors in 2022.
Due to demands of innovation and partnerships across the ecosystem, higher investment in R&D, building products, and platforms will continue. Cloud technology, cybersecurity, data, and artificial intelligence (AI) will continue to be priorities for the industry, and centres of excellence will be established to explore emerging areas like quantum technologies.