JOIN USIT exports try to balance dip in K'taka GDP
With a robust 16 per cent growth in export earnings, the iInformation technology (IT) industry in Karnataka has made a bold statement and has somewhat balanced the poor performance of the state GDP in 2011-12.
In the recently published Karnataka Economic Survey 2011-12, the growth rate of GSDP (Gross State Domestic Product) fell from 8.2 per cent in 2009-10 to 6.8 per cent in 2010-11, owing to poor performances in agriculture and industry which has decreased to -2.9 per cent and 3.6 per cent, respectively.
The exports of IT and IT services have actually proved to be a boon as it tried making up for with its phenomenal growth. It is clear that the economy of the State heavily depends on IT exports which constitute the largest and increasing share in the State’s exports 61.19 per cent in 2008-90 and has now increased to 63.65 per cent in 2010-11.
The total exports of the State stood at Rs 165,523 crore, which is 41.5 per cent of the GSDP. In this, IT exports (Electronics and Software) have increased from Rs 90,734 crore in 2009-10 to Rs 105,350 crore in 2010-11, showing an increase of 16 per cent compared to a 10 per cent increase in the same period last year.
Nasscom Senior Vice-President Sangeeta Gupta said, “ The state has always been in the forefront of IT exports in the country and even so when the economy was going through a crisis. This is because the state has changed with the change in demand and moved to analytics, which is in high demand worldwide.”
These figures, though don’t seem too appealing when seen in segregation, they are indicative of the IT industry's role as a growth driver when compared to export income from other sectors.
The ban on mining in the State has led to a sharp drop in exports of iron ore and minerals from Rs 4,692.97 crore in 2009-10 to Rs 967.97 crore in 2010-11, showing a steep fall of 79 per cent.
Commenting on the IT industry, Infosys Senior Vice-President Group Head of Human Resources, Nandita Gurjar said that over the past decade, the Indian IT sector has become the country’s premier growth engine, crossing significant milestones in terms of revenue growth, employment generation and value creation, in addition to becoming the global brand ambassador for India.
Indian IT market
Karnataka will continue to play its pivotal role in future because according to a study by Ernst & Young, the Indian market for IT products and services is expected to increase from $19.7 billion in 2010 to $41.2 billion by 2015.
Gurjar also said that as one of the key growth engines of the economy, the Indian IT/ITeS industry has been contributing notably to the economic growth accounting for around 5.6 per cent of the country’s GDP.