Bangalore IT exports top USD 6 billion

India IT hub exports up 52%
Software and back-office service exports from Indian technology hub Bangalore grew by half to more than $6 billion in the year to March despite lingering worries about its overloaded transport system.
CIOL

BANGALORE: Software and back-office service exports from Indian technology hub Bangalore grew by half to more than $6 billion in the year to March despite lingering worries about its overloaded transport system.

The region, weathering last year's U.S. election rhetoric against outsourcing, also added 198 new service firms, taking the total number of exporters to 1,520, officials said on Thursday.

Bangalore made up for 97 percent of the southern state of Karnataka's information technology and allied service exports, which grew to Rs 276 billion ($6.3 billion) in 2004/05, up from Rs 181 billion a year earlier.

"The campaign against Bangalore has fallen flat. The infrastructure of the city, though it is under stress, is being developed continuously," Jawaid Akhtar, IT director for the state dubbed India's Silicon Valley, told a news conference.

The city of 6.5 million people, bursting with new vehicles and immigrants, is set to start building an underground railway system and an international airport this year.

Bangalore has the biggest share of India's IT and back-office service exports, which are estimated to have grown 35 percent to $17.3 billion in the year to March.

The industry, fed by a huge low-cost, English-speaking workforce, employs more than 1 million people. Karnataka is home to 300,000 of them, and companies starting last year planned some 50,000 new jobs, officials said.

Among them were Internet firms Google and Amazon and consulting firm Capgemini.

IT secretary Shankaralinge Gowda expected Karnataka's exports to touch $8 billion in 2005/06, representing 27 percent growth.

"We were surprised by 52 percent. Talent pool availability is the key driver of growth," Gowda said.

Karnataka is promoting the palace town of Mysore and the port city of Mangalore as new IT centres. The two now make up for the remaining 3 percent of the state's service exports.

B.V. Naidu, Bangalore director of Software Technology Parks of India, saw increased numbers of foreign companies signing up with it after a slowdown during the U.S. presidential election.

Some 206 IT firms, 129 of them foreign, registered with STPI in 2004/05. Among them were eight hardware companies, including Elcoteq, Europe's top contract manufacturer. The 206 companies plan to invest 27.8 billion rupees, officials said.