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Navigating Challenges: Resilience and Growth in India's Technology Industry
Navigating Challenges: Resilience and Growth in India's Technology Industry

April 2, 2024

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Introduction

In the backdrop of global geopolitical tensions and cautious investment sentiments, India's economic landscape in 2023 witnessed a mix of challenges and opportunities. Despite the hurdles, certain sectors stood out for their resilience and growth, showcasing the technology industry’s ability to adapt and thrive in the face of adversity.

 

Indian Technology Exports: Reaching New Heights

Indian technology exports are on the verge of achieving a significant milestone, poised to surpass the $200 Bn mark, inclusive of hardware. This represents a commendable 3.3% growth compared to FY2023, with domestic revenues also experiencing a robust 5.9% growth, reaching $54.4 Bn in FY2024.

 

Pic 1

Source: Nasscom

Sectoral Analysis: A Closer Look

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*Emerging verticals include Healthcare, Retail, Energy & Utilities, Transportation Travel & Hospitality, Govt., Public Sector & Education, Infrastructure and Others

 

 

Manufacturing

In Q3FY24, the manufacturing sector recorded a sequential growth of 2.3%, with the automotive industry leading the charge in technological advancements such as autonomous driving, vehicle connectivity, and digital twins. Moreover, substantial investments were directed towards electronics manufacturing, particularly in smartphones, AR/VR entertainment, and connected devices, signaling a promising outlook for the sector.

 

 

Energy and Utilities

The energy and utilities sector witnessed a q-o-q growth of 2.4% in Q3FY24, reflecting sustained momentum driven by optimism in the demand environment and ongoing investments in this area.

 

Healthcare

Healthcare emerged as a beacon of growth, with a commendable q-o-q growth of 1.7% in Q3FY24. Rapid digitization and the widespread adoption of innovative healthtech platforms, coupled with the integration of health information systems empowered by AI and other emerging technologies like blockchain, fueled industry transformation.

 

BFSI

The BFSI sector faced challenges, experiencing a decline of 1.1% in Q3FY24. Softness in mortgage, investment banking, capital markets, and insurance segments amidst macroeconomic headwinds contributed to this decline. Nevertheless, companies anticipate recovery in coming quarters with macroeconomic improvements and a resumption of their earlier growth trajectory.

 

Telecom

Despite challenges such as declining revenues and unfulfilled investments in 5G technology, the telecom sector exhibited resilience, showing a sequential growth of 1.5% in Q3FY24, driven by a ramp-up in deals.

 

 

Conclusion: Navigating Complexity with Optimism

In conclusion, Indian technology industry’s diverse sectors continue to navigate complexities, leveraging innovation and adaptability to drive growth in an evolving landscape. Despite challenges, the outlook remains optimistic, with industries poised for recovery and sustained growth in the foreseeable future.

 

Source:

  • ICRA
  • Company Website
  • News Articles
  • Nasscom

 

 

To know more, read our following reports:

Strategic Review report – Rewiring Growth in the Changing Tech Landscape: https://t.ly/PO39n

Quarterly Industry Review Q3FY24: https://t.ly/6ZIzm


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Prajwal Pandey
Research Analyst

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