Structure of India’s IT Industry

Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.

The IT industry has emerged as one of the most important industries in the Indian economy contributing significantly to the growth of the economy.

[br]The IT industry of India got a major boost from the liberalization of the Indian economy. India’s software exports have grown at an annual average rate of more than 50% since 1991. The structure of the IT industry is quite different from other industries in the Indian economy. The IT industry of India is hugely dependant on skilled manpower. Primarily a knowledge based industry, the IT industry of India has reordered significant success due to the huge availability of skilled personnel in India.

The industry structure in the IT sector has four major categories. These are –

  • IT services
  • IT enabled services
  • Software products
  • Hardware
    IT services

    IT services constitute a major part of the IT industry of India. IT services include client, server and web based services. Opportunities in the IT services sector exist in the areas of consulting services, management services, internet services and application maintenance. The major users of IT services are –

  • Government
  • Banking
  • Financial services
  • Retail and distribution
  • Manufacturing[br]
    IT enabled services

    The services which make extensive use of information and telecommunication technologies are categorized as IT enabled services. The IT enabled services is the most important contributor to the growth of the IT industry of India. Some of the important services covered by the ITES sector in India are –

  • Customer-interaction services including call-centers
  • Back-office services
  • Revenue accounting
  • Data entry and data conversion
  • HR services
  • Transcription and translation services
  • Content development and animation
  • Remote education,
  • Data search
  • GIS
  • Market research
  • Network consultancy
    Software products

    Software products are among the most highly exported products from India. The software industry in India originated in the 1970s and grew at a significant pace in the last ten years. Between 1996-1997 and 2002-2003, the Indian software industry grew more than five times from 2630 crores to 13200 crores. During the same period software and service exports from India grew by almost twelve times.


    The hardware sector of the It industry focuses on the manufacturing and assembling of computer hardware. The consumption of computer hardware is high in the domestic market. Due to the rise in the number of IT companies, sales of desktops, laptops, servers, routers, etc have been on the rise in recent years. Many domestic and multi-national; companies have invested in the computer hardware market in India.

    Another categorization in the structure of India’s IT industry is related to the market. There are two major market classifications – the domestic market and the export market. The export market, dominates the IT industry accounting for 75% of the revenue.

  • About EconomyWatch PRO INVESTOR

    The core Content Team our economy, industry, investing and personal finance reference articles.