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Date : Nov 18, 2019
Survey on Computer Software and Information Technology-Enabled Services Exports: 2018-19

Today, the Reserve Bank released the results of the 2018-19 round of its annual survey on exports of computer software and information technology enabled services (ITES). The survey provides information on various characteristics (e.g., type of activity; on-site/off-site nature of services; country of destination; and modes of supply) of India’s exports of software and ITES.

The latest round of the survey uses an activity classification that is in concordance with the classification adopted for the goods and services tax (GST) in the survey schedule (Annex).

For the 2018-19 round of the survey, 8,084 IT companies were approached of which, 1,818 companies, including the twenty largest companies, responded. The responding companies together accounted for 82 per cent of the total software services exports2 of the companies covered (Table 1).

Highlights:

  • India’s export of computer and ITES services (excluding overseas commercial presence) increased by 8.8 per cent during 2018-19 (Table 1).

  • Computer services remained the dominant component of India’s software services exports, accounting for over two third of total software services; the share of ITES exports increased marginally in 2018-19 (Table 2 and 3).

  • Private limited companies accounted for over half of total software services exports (Table 4).

  • USA and Canada remained the top destinations for software exports, followed by Europe in which UK was the top destination (Table 5).

  • The US Dollar remained the major invoicing currency for software exports, followed by the Euro and the Pound Sterling (Table 6).

  • The share of on-site mode of delivery has come down from 25.5 per cent in 2007-08 to a little lower than a sixth of total software and ITES exports in 2018-19 (Table 7).

  • The share of cross-border supply in exports of software services by India increased substantially at the cost of the overseas commercial presence mode of delivery (Table 8).

  • Foreign affiliates of Indian companies continued to augment cross-border services provided by their parent companies in India, although software services provided through commercial presence of foreign affiliates declined by 21.5 per cent in 2018-19 (Table 9).

  • Almost half of the software business by foreign affiliates of Indian companies was provided in the USA, followed by the UK (Table 10).

Ajit Prasad
Director  

Press Release: 2019-2020/1210


Table 1: Survey Response and Final Estimates for 2018-19 – A Snapshot
(₹ crore)
Item Reported^ Final Estimates **
(1) (2)
1. No. of companies 1,818# 8,084
2.Total Exports of Software Services 6,76,190 8,24,245
2.1 IT services 4,45,170 5,32,863
2.2 Software Product Development 18,250 25,186
2.3 BPO Services 1,61,760 2,04,814
2.4 Engineering Services 51,010 61,382
3. Total Exports of Software Services
(including commercial presence)
7,92,698 9,40,762
3.1 Mode 1 (cross-border supply) 5,71,077 6,96,127
3.2 Mode 2 (consumption abroad) 265 323
3.3 Mode 3 (commercial presence) 1,16,517 1,16,517
3.4 Mode 4 (presence of natural person) 1,04,839 1,27,795
^ Response by the largest 20 companies ensured industry representation in the survey coverage.
** Details of estimation methodology are published in the article entitled ‘Survey on Computer Software and Information Technology Enabled Services Exports: 2016-17’ published in March 2018 issue of the RBI Bulletin.
# includes 196 companies, which have reported ‘nil’ exports during 2018-19.

Table 2: Software Services Export from India
Activity 2017-18 2018-19
₹ crore US $ billion* Share (%) ₹ crore US $ billion* Share (%)
(1) (2) (3) (4) (5) (6)
A). Computer Services 4,80,990 74.0 68.2 5,58,049 79.8 67.7
Of which: i) IT services 4,57,280 70.3 64.9 5,32,863 76.2 64.6
               ii) Software Product Development 23,710 3.7 3.3 25,186 3.6 3.1
B). IT Enabled Services 2,24,130 34.4 31.8 2,66,196 38.1 32.3
Of which: i) BPO Services 1,73,910 26.7 24.7 2,04,814 29.3 24.8
               ii) Engineering Services 50,220 7.7 7.1 61,382 8.8 7.5
Total Export of Software Services (A+B) 7,05,120 108.4 100.0 8,24,245 117.9 100.0
Note: The sum of components may differ from total, due to rounding off.
* Using annual average Rupee/ Dollar exchange rate.
These footnotes are applicable for all other tables also.

Table 3: Industry-wise Distribution of ITES/BPO Services Exports
Activity 2017-18 2018-19
₹ Crore US $ billion Share (%) ₹ crore US $ billion Share (%)
(1) (2) (3) (4) (5) (6)
BPO Services 1,73,910 26.7 77.6 2,04,814 29.3 77.0
Business consulting services including public relations services 17,848 2.7 8.0 17,555 2.5 6.6
Finance and Accounting, auditing, book keeping and tax consulting service 27,563 4.2 12.3 36,142 5.2 13.6
HR Administration 1,395 0.2 0.6 1,291 0.2 0.5
Supply chain and other management services/ logistics 865 0.1 0.4 709 0.1 0.3
Medical transcription and document management 1,801 0.1 0.8 667 0.1 0.3
Content development and management and publishing 1,705 0.3 0.8 3,732 0.5 1.4
Other BPO services 1,22,733 18.9 54.7 1,44,718 20.7 54.3
Engineering Services 50,220 7.7 22.4 61,382 8.8 23.0
Embedded Solutions 7,950 1.2 3.5 7,267 1.0 2.7
Product Design Engineering (mechanical, electronics excluding software) 15,880 2.4 7.1 20,983 3.0 7.9
Industrial automation and enterprise asset management 1,050 0.2 0.5 1,365 0.2 0.5
Other Engineering services 25,340 3.9 11.3 31,767 4.5 11.9
Total 2,24,130 34.5 100.0 2,66,196 38.1 100.0

Table 4: Organisation-wise Distribution of Software Services Exports
Types of Organisation 2017-18 2018-19
₹ crore US $ billion* Share (%) ₹ crore US $ billion* Share (%)
(1) (2) (3) (4) (5) (6)
Private Limited Company 3,64,710 56.1 51.7 4,24,834 60.8 51.5
Public Limited Company 3,35,220 51.5 47.5 3,92,618 56.2 47.6
Others * 5,190 0.8 0.8 6,793 1.0 0.9
Total 7,05,120 108.4 100.0 8,24,245 117.9 100.0
* Others includes mostly LLPs.

Table 5: Software Services Exports – Major Destination
Activity 2017-18 2018-19
₹ crore US $ billion* Share (%) ₹ crore US $ billion* Share (%)
(1) (2) (3) (4) (5) (6)
USA & Canada 4,33,084 66.6 61.4 5,04,273 72.1 61.2
Europe 1,69,512 26.1 24.0 2,11,007 30.2 25.6
   of which, UK 81,020 12.5 11.5 96,766 13.8 11.7
Asia 59,584 9.2 8.5 56,131 8.0 6.8
   of which, East Asia 48,510 7.5 6.9 47,064 6.7 5.7
         West Asia 5,922 0.9 0.8 6,347 0.9 0.8
         South Asia 5,152 0.8 0.8 2,720 0.4 0.3
Australia & New Zealand 23,900 3.7 3.4 27,612 3.9 3.4
Other countries 19,040 2.9 2.7 25,222 3.6 3.0
Total 7,05,120 108.4 100.0 8,24,245 117.9 100.0

Table 6: Software Services Exports - Currency Composition of Invoice
Currency 2017-18 2018-19
₹ crore US $ billion* Share (%) ₹ crore US $ billion* Share (%)
(1) (2) (3) (4) (5) (6)
USD 5,12,559 78.8 72.7 5,94,534 85.0 72.1
EUR 55,009 8.5 7.8 79,114 11.3 9.6
GBP 48,857 7.5 6.9 55,399 7.9 6.7
INR 32,300 5.0 4.6 37,322 5.3 4.5
AUD 20,988 3.2 3.0 24,168 3.5 2.9
Other Currencies 35,407 5.4 5.0 33,708 4.8 4.2
Total 7,05,120 108.4 100.0 8,24,245 117.9 100.0

Table 7: Software Services Exports – Type of Services-wise
Type of Services 2017-18 2018-19
₹ crore US $ billion* Share (%) ₹ crore US $ billion* Share (%)
(1) (2) (3) (4) (5) (6)
On-site services 1,10,730 17.0 15.7 1,27,795 18.3 15.5
Off-site services 5,94,390 91.4 84.3 6,96,450 99.6 84.5
Total 7,05,120 108.4 100.0 8,24,245 117.9 100.0

Table 8: Mode-wise Exports of Software Services
Type of Mode Amount
(₹ crore)
Share in Total
(per cent)
2017-18 2018-19 2017-18 2018-19
(1) (2) (3) (4)
Mode 1 (cross-border supply) 5,93,460 6,96,127 69.5 74.0
Mode 2 (consumption abroad) 930 323 0.1 0.03
Mode 3 (commercial presence) 1,48,510 1,16,517 17.4 12.4
Mode 4 (presence of natural person) 1,10,730 1,27,795 13.0 13.6
Total 8,53,630 9,40,762 100.0 100.0

Table 9: Software Business by Foreign Affiliates of Indian Companies during 2018-19 ─ Activity Distribution
(amount in ₹ crore)
Activity Locally To India Other Countries
(1) (2) (3)
IT services 7,852 657 1,074
Software product development 173 1 167
BPO services 8,349 1,020 1,550
Engineering services 520 33 71
Other services 99,623 15,865 17,043
Total (₹ billion) 1,16,517 17,576 19,905
Total (US $ billion*) 16.7 2.5 2.8

Table 10: Software Business by Foreign Affiliates of Indian Companies during 2018-19 Country Distribution
(amount in ₹ crore)
Country Share in Total Software business by foreign affiliates (%) Software business by foreign affiliates
Locally To India Other Countries
(1) (2) (3) (4)
USA 48.3 55,525 14,374 4,431
United Kingdom 11.4 11,614 354 5,568
Canada 4.8 6,754 93 577
Germany 5.3 6,863 68 1,196
Singapore 3.5 4,023 231 1,065
Netherlands 5.0 6,546 39 1,059
Other Countries 21.7 25,192 2,417 6,009
Total 100.0 1,16,517 17,576 19,905

1 The previous data release in the series, covering 2017-18 survey round, was published on December 10, 2018 on the RBI website.

2 Exports of the relatively small companies were estimated by imposing the distribution pattern of the reporting companies. The details of the estimation methodology are published in the article presenting the survey results for 2016-17 round in March 2018 issue of the Reserve Bank of India Bulletin.


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