India's IT Exports Poised for Substantial Growth

According to a recent HSBC Global Research report, India's IT exports are projected to reach a staggering $210 billion by the 2024-25 financial year, capturing 18% of the global IT outsourcing spending. Over the past decade, India's IT exports have nearly doubled, increasing its share of global outsourced IT spending from 13% during the 2015-16 financial year to 18% this fiscal.

The analysts from HSBC, Yogesh Aggarwal, Prateek Maheshwari, and Sagar Desai, anticipate industry growth to accelerate to 6% to 7% in the 2025-26 financial year, driven by a recovery in the US market. However, they note that a weaker outlook for Europe, GenAI uncertainty, and headwinds from global capability centres will limit the growth potential.

Nasscom, the IT industry body in India, reported that IT exports grew by 3.3% in constant currency to $199 billion in the 2023-24 financial year, marking one of the lowest growth rates in the industry's history. The HSBC report highlights that the US demand outlook remains positive, supported by an improving macroeconomic environment, particularly in banking and retail sectors.