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Department of management Lovely Professional University Phagwara
ACKNOWLEDGEMENT
I take this opportunity to present my vote of thanks to all those guidepost who
really acted as lightening pillars to enlighten our way throughout this project that
has led to successful and satisfactory completion of this study.
We are really grateful to our COD Mr.Devdhar shetty for providing us with an
opportunity to undertake this project in this university and providing us with all the
facilities. We are highly thankful to Mr.vishwas chakranarayan for his active
support, valuable time and advice, whole-hearted guidance, sincere cooperation
and pains-taking involvement during the study and in completing the assignment
of preparing the said project within the time stipulated.
Lastly, We are thankful to all those, particularly the various friends , who have
been instrumental in creating proper, healthy and conductive environment and
including new and fresh innovative ideas for us during the project, their help, it
would have been extremely difficult for us to prepare the project in a time bound
framework.
ABSTRACT :-
Information Technology is what constitutes the most important sector in the present
day trend of carrying out business. It is because you cannot be present everywhere
to monitor the work, but with networking and communications, you can always stay
in contact with the other business sites of yours.
With time and the continuous growth across the world, the country continued
struggling and came up as the world leader in Information Technology Sector.
The industry has grown up to US $ 5.7 billion (including over $4 billion worth of
software exports) in 1999-2000, with the annual growth rate not sliding below 50
percent since 1991.
KEYWORDS:-
Computer-aided engineering (CAE) and Finite element analysis (FEA)
Computer-aided manufacturing (CAM) including instructions to Computer Numerical
Control (CNC) machines
Photo realistic rendering
Document management and revision control using Product Data Management
(PDM).
INTRODUCTION
Today, the term information technology has ballooned to encompass many aspects
of computing and technology. IT professionals perform a variety of duties that range
from installing applications to designing complex computer networks and information
databases. A few of the duties that IT professionals perform may include data
management, networking, engineering computer hardware, database and software
design, as well as the management and administration of entire systems. Owing to
its easy accessibility and the wide range of IT products available, the demand for IT
services has increased substantially over the years. The IT sector has emerged as a
major global source of both growth and employment.
It exports software and services to nearly 95 countries around the world. The share
of North America (U.S. & Canada) in India’s software exports is about 61 per cent
ROLE OF IT INDUSTRY
MARKET STRUCTURE
•IDC estimates that in 2008, the worldwide IT market growth will be lower at about
5.5-6.0 per cent, mainly due to the economic slowdown in the US and elsewhere.
Future Outlook:
•With small and midsized businesses driven by the increased use of technology the
country's information and communication technology market is estimated to grow
20.3 per cent annually to reach US$ 24.3 billion by 2011.
•In order to sustain India’s edge in the global markets and improve revenues, Indian
IT-BPO service providers need to shift towards more market-facing breakthroughs.
They could additionally, foray new customer segments in intellectual asset-intensive
service lines like engineering and R&D services, creating IP in emerging technology
areas, developing and codifying specific domain expertise to target consulting and
system integration services, technical innovations to develop their own standards for
next generation of technologies.
•Finally, providers could enhance the role they are already playing in helping improve
the quality of education, by working closely with the Government and academia to
facilitate changes in the curriculum and pedagogy, which directly influence the
quality of graduate output.
Why India?
Inspired by the Indian IT-ITES success story, several other locations have been
presented as alternate options for offshore outsourcing. However, feedback received
from several MNCs having multi-country operations as well as syndicated analyses
comparing the various sourcing locations has revealed that India continues to offer
and deliver the best ‘bundle’ of benefits sought from global sourcing. With significant
potential still untapped, it is expected that the global sourcing phenomenon will
continue to expand in scope, scale and geographic coverage. As global delivery
matures, multi-location strategies will become the norm and most sourcing
destinations, including emerging locations, will grow in size. Building on its existing
strengths, India will remain the leading destination and will continue to play an
important role in most global sourcing strategies.
Strengths
The Indian education system places strong emphasis on mathematics and science,
resulting in a large number of science and engineering graduates. Mastery over
quantitative concepts coupled with English proficiency has resulted in a skill set that
has enabled the country to take advantage of the current international demand for IT.
Quality Manpower
Indian programmers are known for their strong technical skills and their eagerness to
accommodate clients. In some cases, clients outsource work to get access to more
specialized engineering talent, particularly in the area of telecommunications. India
also has one of the largest pools of English-speaking professionals. Strengths at a
Glance
IT INDUSTRY IN INDIA
The Indian information technology sector has been instrumental in driving the
nation's economy onto the rapid growth curve. According to the Nasscom-Deloitte
study, the IT/ITES industry's contribution to the country's GDP has increased to a
share of 5.2 per cent in 2007, as against 1.2 per cent in 1998. Further, the IT and
BPO industries are poised to clock revenues worth US$ 64 billion by the end of fiscal
year 2008, registering a growth of 33 per cent with exports expected to cross US$ 40
billion and the domestic market estimated to clock over US$ 23 billion, according to a
study. Simultaneously, the Indian IT services market is estimated to remain the
fastest growing in the Asia Pacific region with a CAGR of 18.6 per cent, as per a
study by Springboard Research. India's IT growth in the world is primarily dominated
by IT software and services such as Custom Application Development and
Maintenance (CADM), System Integration, IT Consulting, Application Management,
Infrastructure Management Services, Software testing, Service-oriented architecture
and Web services. A report by the Electronics and Software Export Promotion
Council (ESC) estimates software exports to register a 33 per cent growth in the
current financial year with export figures during FY 2008 expected to reach US$ 45
billion. The country's IT exports have, in fact, come quite far, starting from a few
million dollars in the early 1990s. The Government expects the exports turnover to
touch US$ 80 billion by 2011, growing at an annual rate of 30 per cent per annum.
POLITICAL FACTORS:-
This is political factors which affect a business which can be government rules and
regulation toward that particular business environment. For IT industry the Indian
political structure is stable, but there are fears of hung parliament due to a lack of
clear majority in parliament creating fear of wrong investing in the minds of investor
thereby reducing capital. U.S government has declared that U.S firm that outsource
IT works outside the U.S will not get tax benefits, this has caused reduction in U.S
BPO contract from the U.S in the last fiscal year thereby reducing revenue from the
U.S. Indian government has decided to contract IT job to Indian IT companies
creating more opportunities for the company and the industry at large. In software
development different countries is configuration rules and regulation are considered
since client demand differs because of different system requirement. NASSCOM and
DELIOTTE study (impacting economy and society 2007/2008), states that Indian
government has strengthened the IT act, 2000 to provide a sound legal environment
for companies to operate related to security of data in transmission and storage etc
this has served as a positive factor. Infosys has to put Indian relationship with
different countries of business into consideration before investing. Other factors to be
considered are customer protection law, competitive regulations, and terrorist
attacks.
POLITICAL STABILITY: _
India suffered political instability for a few years due to the failure of any party to win
an absolute majority in Parliament. However, political stability has returned since the
previous general elections in 1999. However, political instability did not change
India's economic course though it delayed certain decisions relating to the economy.
The political divide in India is not one of policy, but essentially of personalities.
Economic liberalisation (which is what foreign investors are interested in) has been
accepted as a necessity by all parties including the Communist Party of India
(Marxist).
Thus, political instability in India, in practical terms, posed no risk to foreign direct
investors because no policy framed by a past government has been reversed by any
successive government so far. You can find a comparison in Italy which has had
some 45 governments in 50 years, yet overall economic policy remains unchanged.
Even if political instability is to return in the future, chances of a reversal in economic
policy are next to nil.
As for terrorism, no terrorist outfit is strong enough to disturb the state. Except for
Kashmir in the north and parts of the north-east, terrorist activity is either non-
existent or too weak to be of any significance. It would take an extreme stretching of
the imagination to visualize a Bangladesh-type state-disrupting revolution in India or
a Kuwait-type annexation of India by a foreign power.
ECONOMICAL FACTORS
These includes factors affecting IT industry ranging from rising working pay, global
recession, competition, contract availability and fee. Domestic IT spending grew by
20% and reached $20 billion in 2009. Currency fluctuations caused by the
devaluation of the dollar has affected the industry during the last global recession.
Real estate prices decline resulted in rental expenditure forcing customer to leave
luxuries goods such as electronic and computers that need software to work.
Recession cause low attribute rate due to job layouts and job cuts. India economic
attraction has helped in convincing investors due to low cost advantage. With India’s
global IT spending yet to decline due to entry of new IS companies and the cause of
the recession. With clients industry faced with reduction of work force due to job
layoffs and unsuitable balance sheet most companies have decided not to make
much expenditure in purchase, but make optimum use of existing facilities to make
profits. Most debtors with financial crisis have been granted more time to pay up
causing large debt deficit. With the decline of banking and financial sectors, the
revenue from there is expected to decline, hurting the bottom line of IT majors
DOMESTIC IT SPENDING:-
India's domestic IT market will grow around 14% this year, showing a minor decline
as compared to last year's growth of 16-18%. Hence, it is expected that the country
will see a minor decline in IT budget coming from its domestic market.
"Compared to other countries, India is in a better position. Its domestic market is
expected to grow around 14% this year. We also expect that IT spend in India will
see a minor decline as compared to last year. There could be some 2-3% decline as
compared to last year's budget," commented Arup Roy, senior research analyst at
Gartner.
GLOBAL IT SPENDING:-
Decline in real estate prices has resulted reducing the rental expenditure thus
the industry will grow if the real estate price goes down.
ATTRITION:-\
Almost every sector in India is facing high rates of attrition these days. A recent
study revealed that employees leave either because of compensation reasons or
due to better growth opportunities. According to NASSCOM, Indian IT-ITES industry
recorded US$ 39.6 billion in revenues in 2006-07. The revenue of US$ 49-50 billion
has been projected in 2007-08 at a growth rate of 24-27 per cent. The IT industry's
contribution to GDP was 4.8 per cent in 2005-06
Though the IT/ITES sector is booming, it is constantly facing high attrition rates of
25% - 30%. Even the big brands are also facing the same problem. Below are
the details of attrition rates of various players
in IT sector. According to the survey conducted by BES and Data Quest, Sierra
Atlantic recorded highest attrition rate (29%) followed by Kanbay with 25% and
Accel Frontline with 20 per cent.
ECONOMIC ATTRACTION:-
It is because of this growth many popular brands that have not yet build up there
rigid offices in the country are making it fast to have a destination in India too. For
example, Sun Microsystems, a global IT major, announced in Bangalore to double
the present workforce of the company's Sun India Engineering Center (IEC) from the
present 1000 to 2000 in the next two years time. IEC, which is the largest R&D
center for Sun outside the US, would also focus on developing products in India to
suit the needs of the Indian market, which would be benchmarked globally.
SOCIAL FACTORS
These are social factors affecting IT industry which ranges from employee right,
language barriers, race nationality of company or other issues. English language
being widely spoken in India has help in fostering the industry’s relationship and
interaction in India and on the global stage. India is one of the few countries to have
an increasing share of working population, since there is great availability of both
skilled and unskilled labour force. Great number of institute and universities offer IT
course creating room for availability of IT professional at lower cost since there is job
competition. India has to produces great numbers of IT professional each year to
meet its demand. India continue to produce IT professionals each year, this has help
industry for IT professionals inwards. Industries have to consider the type of services
the software is meant for, age difference of users, life style of the different countries
of supply. It should be noted that there will always be difference in client behaviours
which is supported by the fact that different customers have different taste.
SOCIAL ISSUES;-
Should Industry be concern with the issue of global warming? Yes it is affected by
many government laws regarding it like in china, where company with great amount
of carbon emission are charge great amount of tax. Likewise being a major player in
the global IT market Infosys has introduces measure to help in the reduction of
carbon emission by trying to reduce its water consumption, electricity utilization,
carbon emission and partnering with other companies in troubleshooting this global
dilemma..
EDUCATION:-
There are large number of universities and institutes in India offering IT education.
And there are large numbers of students which everyear passed these courses and
join the IT industry.
The Indian labor is not only cheap but is technically skilled too to the world class
level. It is due to the Indian Education System that includes in its course curriculum
the practical knowledge of the latest technology that is developed in world along with
the fluency in English Language that imparts compatibility in an Indian technician to
communicate and work throughout the world.
CAREER PROSPECTS
In the year 2006-07, the industry hired approximately 3, 80,000 people. Out of
these, the ITeS sector hired 2, 00,000 people and the rest were taken by IT sector.
The recruitment trends of some IT giants are given below: TCS- 35,000 Infosys-
30,000 Wipro-28,000 Satyam-20,000 Some of the areas of specialization in the IT
Industry are-
Designing
Research and Development in Peripheral Integration
Product Quality Control and Reliability Testing
Computer Manufacturing
Maintenance Service
System Developing /Programming /Software Engineering
Networking
Application Programming
EDP/ E- Commerce
Enterprise Resource Planning (ERP)
Database Warehousing and Management
Operating jobs, Computer operators, Data Entry
Working age population also affects the industry a lot because every person has
different value, lifestyle, attitude, and also the satisfaction level.
TECHNOLOGICAL FACTORS;-
TELEPHONY
Cellular mobile telephony tariffs in India are the lowest in the world. A
comparison of Indian cellular tariffs vis-à-vis the tariffs prevailing in comparative
emerging economies in South America & Asia-Pacific region, clearly brings out the
affordability of Indian cellular mobile telephone services.
The airtime tariffs have plunged by over 75% in the last three years alone.
According to the TRAI, the average monthly rental and airtime being realized for
cellular services stands at Rs. 202 and Rs. 1.99 per minute respectively. Prepaid
services have been introduced by all operators at an extremely affordable tariff of
Rs. 300 per month. Roaming charges have been cut by 70% down from Rs.10 to
Rs.3 in early 2002 and now to as low as Rs. 1.50 by several service providers.
• EXPECTED TO HAVE TOTAL SUBSCRIBER BASE OF ABOUT 500
MILLION BY 2010.
• APRU FOR GSM IS USD 6.6 MONTH.
• INDIA HAS THE SECOND LARGEST TELEPHONE NETWORK AFTER
CHINA.
• TELEDENSITY - 19.86 %
• ENTERPRISE TELEPHONE SERVICES, 3G, WI-MAX AND VPN ARE
POISED TO GROW.
INTERNET
NEW IT TECHNOLOGY:-
With the evolution of SOA and semantic web services, enterprise solution heeds to
the limitations of conventional enterprise systems by providing data convergence
and concept reutilization with intelligence.
Web2.O represents the next transition in the evolution of web applications; they
promise to restore the richness, interactivity and usability lacking in many web
applications. As with any technological transition, for an enterprise this implies that
there are new opportunities to be explored and new challenges to be negotiated. To
maximize the benefits of Web2.O, an enterprise should assess. SOA has benefited
enterprises with benefits such as standardized patterns, interoperability, centralized
governance, easy integration etc. Almost all industry domains have benefited from
SOA strategy in order to build more flexible and malleable IT architecture involving
re-usable services. On the other hand, Web 2.0 practices like communities and
folksonomy are much centered around end-users. They involve frequent
communication among large consumers dispersed all around the world over the
Internet. They have become extremely popular among internet users. This brings the
interesting idea of bringing enterprise products i.e. services and consumer-savvy
applications from Web 2.0 together.
CAD:-
CAD was originally the three letter acronym for "Computer Aided drafting" as in the
early days CAD was really a replacement for the traditional drafting board.
But now is the term is often interchanged with "Computer Aided Design" to reflect the
fact that modern CAD tools do much more than just drafting.
CAD is used in the design of tools and machinery and in the drafting and design of
all types of buildings, from small residential types (houses) to the largest commercial
and industrial structures (hospitals and factories).
The people that work in this field are called: Designers, CAD Monkeys, Automotive
Design Engineers and Digital Innovation Engineers. Computer-aided design is also a
common work activity for the traditional engineering professions
Software technologies
Today, CAD systems exist for all the major platforms - CAD systems like QCad, NX
provide multiplatform support including Windows, Linux, UNIX and Mac OS X;
ArchiCAD and Vectorworks work on both Windows and Mac OS X, but not on Linux;
and, for example, AutoCAD works on Windows only. For more information on OS
compatibility, see Comparison of CAD editors for AEC, Comparison of CAD editors
for CAM and Comparison of CAD editors for CAE. Catia V5 is supported on Sparc
Solaris but not x86 Solaris, HPUX, and AIX, but not Linux. It has been announced
that Catia V6 will only be supported on one proprietary operating system.
Right now, no special hardware is required for most CAD software. However, some
CAD systems can do graphically and computationally expensive tasks, so good
graphics card, high speed (and possibly multiple) CPUs and large amounts of RAM
are recommended.
The human-machine interface is generally via a computer mouse but can also be via
a pen and digitizing graphics tablet. Manipulation of the view of the model on the
screen is also sometimes done with the use of a spacemouse/SpaceBall. Some
systems also support stereoscopic glasses for viewing the 3D model.
Another consequence had been that since the latest advances were often quite
expensive, small and even mid-size firms often could not compete against large
firms who could use their computational edge for competitive purposes.[citation
needed] Today, however, hardware and software costs have come down. Even high-
end packages work on less expensive platforms and some even support multiple
platforms. The costs associated with CAD implementation now are more heavily
weighted to the costs of training in the use of these high level tools, the cost of
integrating a CAD/CAM/CAE PLM using enterprise across multi-CAD and multi-
platform environments and the costs of modifying design work flows to exploit the full
advantage of CAD tools
There are many producers of the lower-end 2D systems, including a number of free
and open source programs. These provide an approach to the drawing process
without all the fuss over scale and placement on the drawing sheet that
accompanied hand drafting, since these can be adjusted as required during the
creation of the final draft.
IT Act 2000:
The arrival of the Internet and the World Wide Web made it possible for people to
communicate and transact over cyber space. It was a revolutionary step for
humanity, but it also created a significant need for the regulation and governance of
these activities, a requirement that lead to the creation and implementation of cyber
laws across the globe. India became the 12th nation in the world to adopt a cyber
law during 2000.
• From the perspective of e-commerce in India, the IT Act 2000 and its provisions
Contain many positive aspects. Firstly, the implications of these provisions for the e-
businesses would be that email would now be a valid and legal form of
communication in our country that can be duly produced and approved in a court of
law.
• Companies shall now be able to carry out electronic commerce using the legal
infrastructure provided by the Act.
• Digital signatures have been given legal validity and sanction in the Act.
• The Act throws open the doors for the entry of corporate companies in the business
of being Certifying Authorities for issuing Digital Signatures Certificates.
• The Act now allows Government to issue notification on the web thus heralding e-
governance.
• The Act enables the companies to file any form, application or any other document
with any office, authority, body or agency owned or controlled by the appropriate
Government in electronic form by means of such electronic form as may be
prescribed by the appropriate Government.
• The IT Act also addresses the important issues of security, which are so critical to
the success of electronic transactions. The Act has given a legal definition to the
concept of secure digital signatures that would be required to have been passed
through a system of a security procedure, as stipulated by the Government at a later
date.
• Under the IT Act, 2000, it shall now be possible for corporate to have a statutory
remedy in case if anyone breaks into their computer systems or network and causes
damages or copies data. The remedy provided by the Act is in the form of monetary
damages, not exceeding Rs. 1 crore.
Indian Copyright Act:
• Most importantly the amendments imposed heavy punishment and fines for
infringement of copyright of software.
Income Tax
Deduction under sections 10A/ 10B of Income tax Act, 1961 (“IT Act”) in respect of
profits derived from export of computer software. Following undertakings are eligible
to claim deduction in respect of profits derived from export of computer software
under the provisions of sections 10A/ 10B of the IT Act:
• Existing units which commenced operations prior to April 1, 2000 and claimed
deduction under the provisions of erstwhile sections 10A/ 10B, can continue to claim
such deduction under the provisions of newly substituted sections 10A/ 10B for the
unexpired period of ten consecutive assessment years. Deduction would continue to
be available in case of corporate re-organisations by way of amalgamation or
demerger.
IT SEZ REQUIREMENTS :-
IT companies can set up SEZ with minimum area of 10 hectares and enjoy a
host of tax benefits and fiscal benefits.
• Software Technology Parks of India (STPI), is a society set up by the
Department of Communication & Information Technology, Government Of
India in 1991, with the objective of encouraging, promoting and boosting the
Software Exports from India.
• Companies operating in software technology park (STPI )
Scheme will continue to get tax benefit till 2010.
STPI maintains internal engineering resources to provide consulting, training
and implementation services. Services cover Network Design, System
Integration, Installation, Operations and maintenance of application networks
and facilities in varied areas ranging from VSATs to ATM based networks.
Setting up of the Software Technology Parks of India (STPI), by the Ministry of
Information Technology, Government of India and the International Technology Park
in a joint project by the State Government, the TATA Group and the Singapore
Consortium to promote and facilitate the software exports is another major step
towards the growth of Indian Information Technology Sector.
Similarly an industrial park, known as Electronic City , was set up in 1991 takes more
than a hundred electronic industries including Motorola, Infosys, Siemens, ITI, and
Wipro, in an area of around 330 acres.
The Export Promotion Industrial Park , built near International Technology Park ,
gives an exclusive 288 acres of area for export oriented business. GE has its India
Technology Center located at this park and employs hundreds of multi disciplinary
technology development activities.
The other promotional activities that brought up India to this position include the IT
Corridor project. Conceptualized by Singapore’s Jurong Town Corporation Private
Ltd, the IT corridor Project was initiated by the Department of IT and the Bangalore
Development Authority in order to develop state of the art facilities for the
development of knowledge based industries.
Thus India is a perfect solution for all those companies which seek for cheap, yet
technically skilled labor who have innovative minds and state of art to work over a
project. The ample of facilities provide in a perfect working conditions. For rest, cyber
laws are there to monitor and safeguard everyone's interest related to IT sector.
All these reasons contribute for India to be as the most adored destination to many
companies.
From the 1950s, IBM had a virtual monopoly of computers in India. The 360 series
release in 1960s was the major workhouse of the large organizations. They even
maintained a chain of programmers who could write down software's for their
machines. However in 1978, when George Fernandes, ministry of industries at that
time, commanded IBM to take local shareholders into its subsidiary, the company
refused strictly and went back after winding up its all operations in India. Its ex-
employees then set up Computer Maintenance Corporation, with the primary object
of maintaining IBM computers.
What add more to the dominance of India in Information Technology Sector is the
government policies like the enactment of cyber laws to protect and safeguard the
interest of software companies in India.
ENVIRONMENTAL FACTORS:-
Companies are focusing on reducing the carbon footprints, energy utilization, water
consumption etc.
CONCLUSION:-
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http://www.economywatch.com/business-and-economy/information-technology-
industry.html
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http://www.scribd.com/doc/13886309/Information-technology-IT-sector-INDIA-Indira-
institute-of-management-Pune
http://www.nasscom.org/Nasscom/templates/NormalPage.aspx?id=54612
http://www.nagsoft.com/Why_India.asp
http://www.nasscom.org/Nasscom/templates/NormalPage.aspx?id=6169
http://www.afact.org/include/getfile.php?fid=596
http://www.nasscom.in/Nasscom/templates/NormalPage.aspx?id=6250stic-it-market-
to-grow-lower-at-14/486332/
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