Today, the Reserve Bank released the results of the 2016-17 round of the annual survey on “computer software and information technology enabled services (ITES) exports”. The survey provides information on various characteristics of India’s exports of software services (e.g., type of activity; on-site/off-site nature of services; country of destination; and modes of supply). The survey schedule is given in the Annex. For the 2016-17 round of the survey, 7,506 IT companies were approached, of which 1,362 companies (including most of the large companies) responded. The responding companies accounted for 81.2 per cent of the total software exports during the year. Exports of the remaining companies were estimated by using the distribution pattern after classifying them in four groups, (viz., IT services; business process outsourcing (BPO) services; engineering services; and software product development). Highlights: -
India’s total export of software services (excluding exports through commercial presence) increased by 10.3 per cent in US $ terms. (Table 1) -
Exports of computer services remained the dominant component, with private limited companies and public limited companies holding equal shares in exports during the year. (Tables 2 & 3) -
USA and Canada remained the top destinations of India’s export of software services, followed by Europe in which UK accounted for nearly half. (Table 4) -
The US dollar was the principal invoicing currency, accounting for 73 per cent of software exports, followed by the pound sterling and the euro. (Table 5) -
The off-site mode remained the preferred mode of delivery. (Tables 6) -
The share of export of software services through mode-1 (cross-border supply) and mode-3 (commercial presence) increased during the year and together accounted for 85.9 per cent of software exports. (Tables 7) -
Software exports by foreign affiliates of Indian companies showed an impressive growth of 17.0 percent during 2016-17, their major presence being in the USA and the UK. (Tables 8 and 9) -
Including services delivered by foreign affiliates, total exports of software services by India was placed at US$ 120.4 billion; excluding foreign affiliates, exports are estimated at US$ 97.1 billion. (Tables 1 and 8) Ajit Prasad
Assistant Adviser Press Release : 2017-2018/1574
| Table 1: Software Services Export from India | | Activity | | 2015-16 | | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | A). Computer Services | 4,104.4 | 62.7 | 71.2 | 4506.7 | 67.2 | 69.2 | | Of which: i) IT services | 3,862.8 | 59.0 | 67.0 | 4300.0 | 64.1 | 66.0 | | ii) Software Product Development | 241.6 | 3.7 | 4.2 | 206.7 | 3.1 | 3.2 | | B). ITES/BPO Services | 1,658.7 | 25.3 | 28.8 | 2003.3 | 29.9 | 30.8 | | Of which: i) BPO Services | 1,336.8 | 20.4 | 23.2 | 1539.0 | 23.0 | 23.7 | | ii) Engineering Services | 321.9 | 4.9 | 5.6 | 464.3 | 6.9 | 7.1 | | Total Export of Software Services (A+B) | 5,763.1 | 88.0 | 100.0 | 6510.0 | 97.1 | 100.0 | Note: The sum of components may differ from totals, due to rounding off. This is applicable for other tables also.
* Using annual average Rupee/ Dollar exchange rate. This is applicable for all other tables also. |
| Table 2: Industry-wise Distribution of ITES/BPO Services Exports | | Activity | 2015-16 | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | BPO Services | 1,336.8 | 20.4 | 80.6 | 1539.0 | 23.0 | 76.8 | | Customer interaction services | 57.9 | 0.9 | 3.5 | 99.9 | 1.5 | 5.0 | | Finance and Accounting, auditing, book keeping and tax consulting services | 185.0 | 2.8 | 11.2 | 206.2 | 3.1 | 10.3 | | HR Administration | 19.9 | 0.3 | 1.2 | 12.7 | 0.2 | 0.6 | | Procurements and logistics | 7.7 | 0.1 | 0.5 | 7.2 | 0.1 | 0.4 | | Medical transcription | 13.6 | 0.2 | 0.8 | 15.7 | 0.2 | 0.8 | | Document Management | 6.8 | 0.1 | 0.4 | 7.0 | 0.1 | 0.3 | | Content development and management and publishing | 12.8 | 0.2 | 0.8 | 17.0 | 0.3 | 0.8 | | Other BPO services | 1,033.1 | 15.8 | 62.2 | 1173.3 | 17.5 | 58.6 | | Engineering Services | 321.9 | 4.9 | 19.4 | 464.3 | 6.9 | 23.2 | | Embedded Solutions | 72.7 | 1.1 | 4.3 | 74.5 | 1.1 | 3.7 | | Product Design Engineering (mechanical, electronics excluding software) | 84.4 | 1.3 | 5.1 | 155.0 | 2.3 | 7.7 | | Industrial automation and enterprise asset management | 0.9 | 0.0 | 0.1 | 1.1 | 0.0 | 0.1 | | Other Engineering services | 163.9 | 2.5 | 9.9 | 233.7 | 3.5 | 11.7 | | Total | 1,658.7 | 25.3 | 100.0 | 2003.3 | 29.9 | 100.0 |
| Table 3: Organisation-wise Distribution of Software Services Exports | | Types of Organisation | 2015-16 | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | Private Limited Company | 2,553.3 | 39.0 | 44.3 | 3,203.0 | 47.8 | 49.2 | | Public Limited Company | 3,134.1 | 47.8 | 54.4 | 3,275.1 | 48.8 | 50.3 | | Others | 75.7 | 1.2 | 1.3 | 31.9 | 0.5 | 0.5 | | Total | 5,763.1 | 88.0 | 100.0 | 6,510.0 | 97.1 | 100.0 |
| Table 4: Destination of Software Services Exports | | Activity | 2015-16 | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | USA & Canada | 3,554.7 | 54.3 | 61.7 | 3953.9 | 59.0 | 60.3 | | Europe | 1,352.0 | 20.7 | 23.5 | 1516.3 | 22.6 | 23.1 | | of which UK | 684.1 | 10.4 | 11.9 | 729.2 | 10.9 | 11.1 | | Asia | 487.0 | 7.4 | 8.4 | 655.6 | 9.8 | 10.7 | | of which East Asia | 412.6 | 6.3 | 7.2 | 483.9 | 7.2 | 8.1 | | West Asia | 65.7 | 1.0 | 1.1 | 74.8 | 1.1 | 1.1 | | South Asia | 8.6 | 0.1 | 0.2 | 96.9 | 1.5 | 1.5 | | Australia & New Zealand | 198.2 | 3.0 | 3.4 | 216.2 | 3.2 | 3.3 | | Other countries | 171.2 | 2.6 | 3.0 | 168.0 | 2.5 | 2.6 | | Total | 5,763.1 | 88.0 | 100.0 | 6510.0 | 97.1 | 100 |
| Table 5: Currency Composition of Invoice ̶ Software Services Exports | | Currency | 2015-16 | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | USD | 4,261.0 | 65.1 | 73.9 | 4754.3 | 70.9 | 73.0 | | GBP | 539.3 | 8.2 | 9.4 | 519.6 | 7.8 | 8.0 | | EUR | 438.0 | 6.7 | 7.6 | 466.6 | 7.0 | 7.2 | | AUD | 177.5 | 2.7 | 3.1 | 191.0 | 2.8 | 2.9 | | INR | 75.0 | 1.1 | 1.3 | 234.9 | 3.5 | 3.6 | | Other Currencies | 272.3 | 4.2 | 4.7 | 343.6 | 5.1 | 5.3 | | Total | 5,763.1 | 88.0 | 100.0 | 6510.0 | 97.1 | 100.0 |
| Table 6: Software Services Exports – Type of Services-wise | | Type of Services | 2015-16 | 2016-17 | | ₹ billion | US $ billion* | Share (%) | ₹ billion | US $ billion* | Share (%) | | (1) | (2) | (3) | (4) | (5) | (6) | | On-site Services | 1,145.7 | 17.5 | 19.9 | 1121.2 | 16.7 | 17.2 | | Off-site Services | 4,617.4 | 70.5 | 80.1 | 5388.8 | 80.4 | 82.8 | | Total | 5,763.1 | 88.0 | 100.0 | 6510.0 | 97.1 | 100.0 |
| Table 7: Mode-wise Exports of Software Services | | Type of Mode | Amount (₹ billion) | Share in Total (per cent) | | 2015-16 | 2016-17 | 2015-16 | 2016-17 | | (1) | (2) | (3) | (4) | | Mode 1 (cross-border supply) | 4,604.8 | 5374.5 | 64.8 | 66.5 | | Mode 2 (consumption abroad) | 12.6 | 14.3 | 0.2 | 0.2 | | Mode 3 (commercial presence) | 1,339.7 | 1567.8 | 18.9 | 19.4 | | Mode 4 (presence of natural person) | 1,145.7 | 1121.2 | 16.1 | 13.9 | | Total | 7,102.8 | 8077.8 | 100.0 | 100.0 |
| Table 8: Software Business by Foreign Affiliates of Indian Companies ─ Activity Distribution | | (₹ billion) | | Activity | 2016-17 | | Locally | To India | Other Countries | | (1) | (2) | (3) | | IT services | 51.0 | 5.2 | 6.0 | | Software Product Development | 0.8 | 0.6 | 14.9 | | BPO Services | 70.1 | 2.3 | 12.0 | | Engineering Services | 5.6 | 0.3 | 0.1 | | Othe services | 1,440.30 | 93.0 | 112.1 | | Total (₹ billion) | 1,567.80 | 101.4 | 145.1 | | Total (US$ billion*) | 23.4 | 1.5 | 2.2 |
| Table 9: Software Business by Foreign Affiliates of Indian Companies - Country Distribution -2016-17 | | (₹ billion) | | Country | Share in Total Software business by foreign affiliates (%) | Software business by foreign affiliates | | Locally | To India | Other Countries | | (1) | (2) | (3) | (4) | | USA | 65.0 | 1064.8 | 73.9 | 39.8 | | United Kingdom | 6.7 | 101.3 | 2.4 | 18.2 | | Canada | 3.6 | 62.5 | 0.0 | 1.9 | | Germany | 3.3 | 48.6 | 7.2 | 4.0 | | Singapore | 2.9 | 40.4 | 1.1 | 11.9 | | Netherlands | 2.7 | 40.1 | 0.1 | 9.4 | | Other Countries | 15.8 | 210.1 | 16.7 | 59.9 | | Total | 100.0 | 1567.8 | 101.4 | 145.1 |
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