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| Photo by Alex Knight: https://www.pexels.com/photo/high-angle-photo-of-robot-2599244/ |
The phenomenal growth seen by the Indian IT industry over the past few decades has clearly been a remarkable one, transforming India’s image from being largely an agricultural economy to a technology superpower. The industry seems to be all set to continue on its upward trajectory despite facing global headwinds.
According to NASSCOM the industry shall grow at the rate of 5.1% in FY2025, which is more than the 4% growth achieved in FY2025. Its turnover is expected to rise from $282.6 billion in FY 20225 to more than $300 billion in FY 2026.[1] That being stated, the industry growth rate is quite modest being in single figures, with the biggest perceived challenge coming from the rise and rise of AI.
The fact that it is not all smooth sailing for the Indian IT sector is borne out by the fourth quarter results of financial years 2025 posted by Indian IT majors, Infosys, TCS, Wipro and HCL Tech. While Infosys saw a 3.5% drop over the previous quarter, the other three big guns saw their top lines go down by 0.8%.[2]
Given the inherent strength of the India IT sector, however, the way forward is both challenging as well as potentially rewarding. There is no denying that fact that the global economic as well as geo-political situation is quite fluid and dynamic and will remain so in the near future. In circumstances such as these, India needs to adopt a multi-faceted and multi-pronged approach.
From integrating IT into their service offerings to shifting their focus to innovation and value creation, there is much that leading Indian IT companies can do to remain globally relevant and competitive. With regard to the Indian IT sector, being a major employment provider, it is important to upskill and reskill its workforce. Those with expertise in data science, AI, machine learning and cyber security will be particularly valued.
Besides, Indian IT companies should diversify their service offerings, making them not unnecessarily dependent on specific sectors. Among the verticals they can look at are healthcare, advanced manufacturing and sustainability. It is also crucial for them to substantially invest in R&D which would empower them to come up with cutting-edge solutions, thereby gaining an edge over competition in the global market.
The Indian IT industry can definitely continue to be both a major player globally as well as an important contributor to the Indian economy in the time to come if it learns to adapt to the evolving technological landscape. It would do well to hire the right kind of talent and diversify its offerings, apart from working on strengthening its core capabilities.
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