IT sector headed for an upturn next year: Nasscom

BENGALURU: The information technology sector, which has been bogged down by unfavourable geo-political factors over the past several months, may witness an upturn in the coming years, according to Nasscom.

Over the two years, investments in technology have taken a beating owing to political and technological uncertainties. However, these challenges are getting resolved now and the situation is stabilising. So, the prospects of the IT sector seem bright in the coming year, Nasscom president R Chandrasekhar told agencies.

Speaking at the launch of the 2017 edition of the Nasscom-Zinnov report on ‘Indian Start-up Ecosystem – Traversing the maturity cycle’, here on Thursday, he said that start-ups will also contribute to the overall growth.

“The Indian start-up ecosystem is maturing, driven by young, diverse and inclusive entrepreneurial landscape. This is leading to emergence of focused domain solutions for verticals like healthcare, agriculture, and education. Nasscom will continue its drive towards catalysing deep tech start-ups, build category leaders and support start-ups to create for India.”

India is witnessing a rapid rise in the start-up ecosystem with over 1,000 tech start-ups being added in 2017, the Nasscom report said. As on date, the country hosts at least 5,000 technology-related start-ups. “While Bengaluru, Delhi/NCR and Mumbai retained their position as the key start-up hubs in India, 20 per cent of the start-ups have emerged from tier-2 and -3 cities,” the report stated.

As much as 40 per cent of start-ups are in the B2B segment. There are an estimated 360 fin-tech start-ups as of 2017, growing at 31per cent year-on-year. These start-ups have received over $200 million in funding in the first half of the financial year. Health-related start-ups — there are about 320 of them —have witnessed a 28 per cent y-o-y growth this year.

Digital payments and lending, wealth management, and insurance technology are the emerging areas of growth in the start-up ecosystem, the report noted.  

“Today, the Indian ecosystem is flooded with innovative ideas and needs the right channel and guidance in terms of acceleration, scaling up and funding to continue to disrupt,” said Raman Roy, chairman, Nasscom.