Lok Sabha Question No. 3623 (UNSTARRED), answered on 2016-12-07
Subject: Recession in IT Sector
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: PREM SINGH CHANDUMAJRA, DEVJI MANSINGRAM PATEL

## GOVERNMENT OF INDIA MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK SABHA UNSTARRED QUESTION NO.  3623

TO BE ANSWERED ON: 07.12.2016

## RECESSION IN IT SECTOR

## 3623. PROF. PREM SINGH CHANDUMAJRA: SHRI DEVJI M. PATEL:

Will the Minister of Electronics & Information Technology be pleased to state: -

- (a) whether recession has been noticed in the Information Technology Industry and Indian IT companies are immensely affected in the country as well as abroad and employment generation is also declining in the industry;
- (b) if so, the details thereof and the reasons therefor;
- (c) whether the Government has planned to pump huge investment in the IT sector during the year 2016;
- (d) if so, the details thereof and the target achieved in this regard so far along with the details of investment made in 2016 as compared to the previous year;
- (e) whether automation has taken place in IT sector as a result of which lakhs of employment opportunities are likely to be lost in the near future; and
- (f) if so, the details thereof and the reaction of the Government thereto?

## ANSWER

## MINISTER of STATE for ELECTRONICS AND INFORMATION TECHNOLOGY (SHRI P. P. CHAUDHARY)

(a) and (b):   According to National Association of Software and Services Companies (NASSCOM), the impact of short-terms  factors  such  as    global,  political,    economic  and  business  scenarios  is  slowing  down  the  global  IT spend.  However, the Indian Information Technology (IT) and IT Enabled Services (ITES) industry is expected to sustain its growth rate.  The total revenue of Indian IT-ITES industry is estimated at  US$ 130 billion in FY 201516  as  compared  to  US$  118  billion  in  FY  2014-15.    The  Indian  IT-ITES  industry  has  been  progressively contributing to the growth of exports and creation of employment opportunities. The total IT-ITES Industry export revenue (excluding hardware) is estimated at US$ 108 Billion in 2015-16, as compared to US$ 98.0 billion in 2014-15 with Year on Year (YoY)  growth of 10.2 %.  The direct employment in IT-ITES sector has increased from 34.8 Lakhs in 2014-15 to 36.8 Lakhs in 2015-16 with a net addition of over 2.0 Lakhs employees.

(c)  and  (d):    The  Ministry  of  Electronics  &  Information  Technology  (MeitY),  Government  of  India  is implementing Digital India programme. The vision of Digital India is centred on three key areas; (i) Infrastructure as a Utility to Every Citizen (ii) Governance & Services on Demand and (iii) Digital Empowerment of Citizens. The  Government  has  been  actively  supporting  the  IT  sector,  being  the  key  partner  in  the  various  flagship programmes of the Government  such as   Digital India,  Make  in  India,  Skill  India,    E-governance  and  Startup India. These programmes are creating an enabling eco-system for promotion of IT industry.  The promotion of electronics  manufacturing  in  the  country  is  one  of  the  important  pillars  in  'Digital  India'  programme.  The Government  has  notified  the  Modified  Special  Incentive  Package  Scheme  (M-SIPS)  to  attract  investments  in Electronic System Design and Manufacturing (ESDM). The capital investments in ESDM made over a period of 10 years are considered for incentives.  Till now, 243 applications involving investment proposal of ` 1,26,838 crore in various electronic sectors have been received under the scheme.

Under  the  Digital  India  programme,  MeitY  has  incurred  expenditure  of ` 1457.33  crores  in  FY    2015-16  as compared to ` 1685.71 crores in the previous year.

(e) and (f): The technology automation has not replaced labour, but improved productivity and provided workers the time to focus on other tasks involving complex decision making and social interactions. The adoption of new technology rather creates  jobs, increases productivity, and increases the demand for skilled labour.  The Indian IT-ITES industry continues to be a net hirer, and provides on -the- job training.  Over the next decade, Indian ITITES industry would continue to create jobs.

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