Leveraging accelerated global tech spending, the Indian Technology sector is estimated to witness a growth of over 15% in FY 2022, as per a recent report by the National Association of Software & Services Companies (NASSCOM).
72% CXOs expect 2022 to be another growth year driven by digital demand and higher investments in R&D, with resilience and agility integrated into the industry business model.
Rekha M. Menon, Chairperson, NASSCOM said, “Fiscal 2022 has been a breakthrough year for the Indian technology industry. We’ve posted solid, broad-based growth, massively increased jobs, and are proud that we continue to be an engine for India’s economic growth, and a beacon for inclusion and diversity."
The report revealed that the technology industry in India has crossed the $200 billion revenue mark, earning $227 billion revenue in FY 2022. The tech industry has witnessed a $30 bn incremental revenue in the year with an overall growth rate of 15.5%.
"We are excited about the opportunities in the Techade as we enter an era of exponential transformation and technology becomes indispensable to progress. We remain committed to catalysing the trillion-dollar digital economy with our focus on talent, technology, collaboration, and innovation," Rekha added.
The role of the tech sector as an employment generator
India has over a 5 million tech workforce, making it a global hub for digital talent.
The tech industry recorded nearly 10% estimated growth in direct employee pool in FY2022E with a highest-ever net addition of approximately 450,000 to its employee base.
With one out of 3three employees already digitally skilled, the digital tech talent pool is currently at 1.6 million and growing at a CAGR of 25%.
The massive focus on reskilling and upskilling seems to be driving the growth of digital talent in the country.
The Indian tech industry reskilled approximately 280k employees in FY2022. With over 36% of women employees, the Indian tech industry is one of the largest private-sector women employer in India with over 1.8 mn women in the workforce.
Way Forward: The rapidly growing tech industry
Even amidst the ongoing global crisis, geopolitics, macroeconomic fluctuations, supply chain disruptions, and the after-effects of the pandemic, the tech industry will continue to display grit, resilience and agility.
What will drive the growth?
The current demand trends on technology spending and economic growth indicate a positive outlook on technology spending and hiring. The industry itself has set an ambitious goal of $350 billion by FY2026 growing at a rate of 11-14%.
Debjani Ghosh, President, NASSCOM, said, “NASSCOM will continue to focus on priorities and play its role in catalysing the trillion-dollar digital economy through accelerated industry growth and building thought leadership. Leading the industry transformation narrative of Think Digital Think India, the industry will maximise tech innovation and impact and build on future-readiness with the Digital Next priority of the industry.”
Leaders look forward to driving this growth with innovation and partnerships across the ecosystem. CXOs will accelerate digital capabilities and invest in R&D, building products and platforms.
Top tech priorities for businesses
Cloud, Cybersecurity, Data and AI will continue to be top tech priorities for the industry. Additionally, Centres of Excellence will be set up in emerging areas like quantum technologies.
The report highlights that the positive revenue growth for the tech industry will be driven by strong deal pipelines, with a larger proportion of smaller deals for niche differentiated products, enhanced digital demand and high tech spends in Pharma/Healthcare, BFSI, Manufacturing, Retail/eCommerce verticals in 2022.
To make most of the oncoming opportunities, the businesses in the tech sector have to focus on ‘Employee First’ approach and aggressively work on priorities like attracting and retaining talent, ramping up hiring for skill and scale especially for digital, campus and non-engineering talent. The hybrid work model may prevail depending on individual company policies and job role requirements.