Indian software services exports up 4% in FY21

The Reserve Bank has released data for the 2020-21 cycle of its annual survey of exports of computer software and information technology-enabled services. The survey collects details of Indian exports of software services {IT and Information Technology Enabled Services (ITES)/Business Process Outsourcing (BPO) Services} by type of activity, nature onsite/offsite services, country of destination and four modes of supply. For the 2020-21 cycle of the survey, 6,115 software exporting companies were contacted, of which 1,815 companies responded, including most large companies.

India’s exports of software services (excluding exports via commercial presence) are estimated at US$133.7 billion in 2020-21, registering a growth of 4% from the previous year. Computer services and ITES accounted for 65.3% and 34.7% of total software services exports, respectively.

BPO services were the dominant component of IT services exports. More than half of software services exports were carried out by limited liability companies. The United States was the top destination for software exports, accounting for 54.8%; Europe had a 30.1% share, with almost half in the UK.

The US dollar was the main invoicing currency for software exports with 72% market share; The euro and the pound sterling together accounted for an additional 15.9%.
The share of offsite mode in software services exports has gradually increased to 87.1% in 2020-21 from 80.1% five years ago.

The share of mode 1 (cross-border supply) in Indian software services exports has further increased to 78.4% in 2020-21: this mode 1 share has increased over the years from 38.8% in 2002 -03 to 64.6% in 2009-10 then to 75.1% in 2019-20, to the detriment of the three other modes of delivery {i.e. mode-2 (consumption abroad); mode-3 (commercial presence); and mode-4 (presence of natural persons)}.

Exports of software by foreign affiliates through commercial presence, where the United States is a major destination, amounted to $14.6 billion in 2020-21. Total exports of software services, including services provided by foreign affiliates of Indian companies, recorded a growth of 2.1% in 2020-21 and amounted to US$148.3 billion.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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