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Information Technology Industry

The information technology (IT) industry has become of the most vigorous
industries in the world. IT, more than any other sector, has an increased
output, particularly in the developed world, and as a result is a key driver of
global economic growth. Economies of scale and unquenchable demand from both
consumers and enterprises describe this rapidly growing sector.

The Information Technology Association of America (ITAA) describes the
information technology as covering all possible aspects of information
systems based on computers.
Together software development and the hardware involved in the IT industry
incorporate everything from computer systems, to the design, execution, study
and expansion of IT and management systems.

Due to its user-friendliness and the wide range of IT products available, the
demand for IT services has improved substantially over the years. The IT sector
has come out as a major global basis of both development and employment.

The government acquired EVS EM computers from the Soviet Union to be used in
research laboratories and large companies. Tata group established Tata
Consultancy Services in 1968, the then largest software producer. Indian
Institute of technology at Kharagpur in West Bengal was inaugurated on August
18, 1951. Due to the relaxed Immigration laws, USA attracted large number of
skilled professional aiming for research. The National informatics centre was
established in 1965. From 1977 to 1980s the countrys information technology companies stared showing making their present felt.
After the microchip revolution of 1980s India understood the importance of electronics and information technology in
its growth and development.

Internet Access

In 1991, Videsh Sanchar Nigam Limited (VSNL) introduced Gateway Electronic Mail
Service, in 1992 the 64 kbit/s leased line service was introduced, and
commercial Internet access on a visible scale in 1992. Election results were
displayed via National Informatics Centers NICNET. In 1991, economic reforms were introduced giving rise to a new era of
globalization and international economic integration. Indian IT professionals
entered the US throughout the 1990s.

The growth of Information Technology in India also had far-reaching political
consequences. Indias reputation as a destination of skilled manpower and as a source of IT
improved its relation with many developed world economies. 30% of export
earning and 40% of the countrys GDP after employing only 25% of its workforce throw light on the economic
effect of technologically inclined services sector in India.Software and
services exports are anticipated to have grown by 32% in dollar terms to
surpass US$ 23 billion. Sales of Personal computers crossed 4.7 million units;
an escalation of 20% compared to 3.6 million units sold the previous year.

Characteristics of the IT Industry at a Glance

For information technology industry, the Economies of scale are high. The
marginal cost of each unit of additional software or hardware is minimal
compared to the value addition that results from it.

The IT industry is knowledge-based unlike other sectors.

Efficient usage of skilled labor forces in the IT sector can help an economy
achieve a rapid pace of economic growth.

The IT industry helps many other sectors like the services and manufacturing
sectors in the growth process of the economy.

The IT industry can serve as a means of e-governance, as it promises easy
accessibility to information. The applicability of information technology in
the service sector develops operational competence and adds to transparency. It
also serves as a means of skill formation.

A large variety of services come under the area of the information technology
industry such as Networking, database design and development, testing, systems
architecture, maintenance and hosting, documentation, operational support,
application development and security services.

Market parameters

The Indian IT industry is divided mainly into two markets: domestic market and
exports market. The exports market comprises the biggest segment accounting for
75% of the total revenue made by the Indian software industry. Indian IT companies have also globally established their dominance in terms of
availability of skilled manpower, cost advantage and the quality of services.
They have been developing their global service delivery capabilities through an
amalgamation of organic and inorganic growth schemes. Global giants like SAP,
Microsoft Lenovo and Oracle have already established their captive centres in
India. These global giants have recognized the advantage India offers and the
fact that it is among the fastest developing IT markets in the Asia-Pacific
region.

1 Comment

  1. Arushi GOyal says:

    you should include something more about the future of the Information Technology sector of India…

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