IT IS BACK

INDIA’S IT SERVICES INDUSTRY HAS REBOUNDED STRONGLY, WITH DEMAND CLIMBING THANKS TO CLIENTS’ INCREASING NEED FOR DIGITAL SERVICES, DRIVEN BY THE PANDEMIC

- DILASHA SETH

A ONCE-IN-A-DECADE opportunity.” That’s how Rajesh Gopinathan, CEO and MD, Tata Consultancy Services (TCS) describes the current robust demand environment for information technology (IT) services. Not since the 1990s has the sector witnessed such a boom period. From a nascent industry worth about $150 million in 1991, the IT industry exploded to top $5.6 billion by the turn of the millennium. Two decades later, they are back at it. The top four—TCS, Infosys, Wipro and HCL Technologies—are set to clock double-digit revenue growth this fiscal. Their deals pipelines are overflowing, with strong demand in emerging areas such as cloud computing, artificial intelligence (AI) and cybersecurity, amid an across-the-board digitalisation drive in the post-pandemic world.

Consider this. The global market for technology and business services jumped 40 per cent between July and September, the fastest quarterly growth in at least seven years, according to data from technology research and advisory firm Information Services Group. In fact, ISG has doubled its 2021 forecast for managed services growth to 10.1 per cent since the start of the year, and lifted its forecast for cloud services growth to 25 per cent from 18 per cent.

This is a result of the ongoing structural shift in the way businesses globally are operating since the pandemic. For example, while the education and retail sectors are accelerating their digital transformation, hotels and airlines are adopting contactless check-ins. Businesses are increasingly migrating their data to the cloud. This is causing a spike in demand to build new business models using data science, cybersecurity and AI. And forecasts are constantly being revised.