The concept of software outsourcing in India is nothing new, and you can also notice it in the Information technology field. World-class capabilities, low operating costs, and risk distribution with partners are some noticeable benefits obtained from Software outsourcing services. Fortunately, India has become one of the most commonly chosen destinations where several organizations like to outsource their software services.
Why do several companies think of software outsourcing in India?
A few years ago, headcount and cost reductions were major reasons for outsourcing IT services. Today, companies have become highly strategic, and they try to make the best use of their core competencies. Earlier, companies used to outsource only manufacturing activities.
In the present tech-savvy world, Information Technology is highly important for every business. That is why you can notice a significant transformation in the outsourcing market. Companies of different sizes try to focus on their major activities and outsource non-core functions when they find a lack of skills in the in-house team.
Let’s now analyze the reasons why lots of organizations choose companies like Onviqa Private Limited for software outsourcing in india.
Onviqa Private Limited is also one such company that offers Infrastructure Technology services to clients from different countries. It offers a range of solutions, from software development to marketing automation. So, Onviqa is one of the contributors to the growing market of IT and software outsourcing in India. From the revenue perspective, the market value in 2019 was around INR 5,649.47 billion. According to market analysts, the amount will touch INR 8,830.14 billion by 2025. During 2020-2025, the rate of CAGR was 7.25%.
Reduce development cost
The labor cost in developed countries is comparatively high. However, as India is a developing country, the labor charge is comparatively low. In developed countries, a software developer can charge $70-$150 per hour. But, Onviqa as outsourcing in India charges 50% of this rate. That is why several organizations and startups hire project managers, developers, and QA engineers from India.
Maintain the desired quality standards
The best software development service providers in India maintain quality standards, as they work with a special QA team. India has a big pool of talent to serve companies of different types. For instance, Onviqa Private Limited, one of the top 10 Software Outsourcing Companies in India, has dedicated project managers and quality testers. Before delivering a project, they check the quality of the codes.
Find global talents
Several companies are interested in finding hidden talents in this world. They like to connect with the best professionals by outsourcing IT activities to Indian companies. It is easy to find the most efficient tech team for every project.
To take advantage of innovative technologies
When creating a new application and other digital products, technologies are highly important. But, geographic restrictions prevent some companies from finding the best tech specialists. In India, more than 3 million young candidates get graduate degrees in reputable IT colleges. Thus, companies can easily connect with tech enthusiasts who know about blockchain, data science, ML, AI, and other technologies.
To remove communication barriers by software outsourcing in India
There is a myth that outsourcing services to India can result in communication challenges. But, the truth is that India ranks second in terms of English-speaking population. Over 125 Indians have chosen English as their second language. Clients from other countries can easily communicate with developers and IT consultants of Indian companies like Onviqa. Onviqa also has a team of representatives to respond to its clients’ queries and maintain communication regularly.
For a better government-friendly relationship
The Indian government is interested in helping organizations to thrive fast through outsourcing. It has also announced different policies and acts to make the outsourcing process smoother and easier.
Why is India the best destination for software outsourcing purposes?
There are some reasons why India has become a preferred country to outsource IT activities.
The massive size of the software outsourcing in india
IT companies engaged in offshore activities have shifted their approach. They no longer stick to the basic agreement. Tailored agreements of these companies have become the major attractions to organizations in different countries. A software development agency works as the service integrator.
As per Gartner’s estimation, IT investments in India have a chance to reach US$ 101.8 billion in 2022. In 2021, the estimation was US$ 81.89 billion.
The software product development industry in India will reach almost US$ 100 billion by 2025. Most importantly, several Indian organizations are thinking of making an international investment to establish a global presence.
Best companies with skilled workforce
Google, Microsoft, Cisco, and other Fortune 500 companies have set up their offices in India. TCS, Infosys, and IBM are some big names in the tech industry. So, it is another reason why western companies have chosen India to outsource their IT activities.
More about the investment stats in India
- In the IT industry, PE investments in 2021 would reach the US $23.4.
- The IT startups in India have received a massive investment of almost US$ 36 billion from private companies.
- Amazon teamed up with Airtel to sell AWS (Amazon Web Services) to customers. It has also decided to invest US$1.6 billion. In 2022, Google declared an investment of US$ 1 billion in Bharti Airtel Ltd.
What is the reason behind the rapid growth of the IT market?
As India has witnessed significant advancement in digital infrastructure, the IT outsourcing industry is thriving fast. The emergence of high-speed internet connection, software tech park units, special economic zones, and a few other factors have driven market growth.
Moreover, Indian IT agencies like Onviqa have started training their workforce on different innovative technologies like AI, automation, Machine Learning, analytics, and IoT. However, international standard in-house centers affect the market’s progress. Complicated geopolitical issues also caused obstacles to the growth of the industry.
Different Acts that prompted the growth of the Information Technology sector
IT Act 2000
The IT Act is highly significant legislation for different outsourcing agencies. Moreover, eCommerce businesses also focus on the Act, which is related to data protection, online transactions, storage details, cybercrimes, and electronic communications. Under the legal rules, the implications are important while creating the outsourcing agreement in India. The rules are also intended to protect the international transfer of sensitive data.
Legal restrictions on processing data
As there was no particular law about data security and processing, the IT Act governs data protection. According to this Act, there should be reasonable security procedures to protect data from unauthorized modification, damage, and access.
The IT Rules 2011 ensure the best standard of security practice. They focus on the provision of data and privacy policies to be implemented by corporate entities. These rules have also defined sensitive personal details. While disclosing data to any third party, it is important to have the consent of the data provider.
Indian Contract Act., 1872 – A regulatory environment
It is another act related to the contractual deal. Both foreign and Indian companies should focus on this Act while making a valid contract. The Act also talks about remedies in case of breach of contract. According to legal rules, companies should agree to terms associated with indemnities, warranties, and clauses.
The software outsourcing segmentation in India
Segmentation according to types
Packaged software and IT services are the major categories of the IT outsourcing sector. The IT services market segment covers almost 89.70% of the overall market share in FY 2019. However, you can also notice rapid growth in the packaged software market segment. Indian IT specialists at Onviqa are skilled at dealing with analytics, mobility, and cloud technologies. That is why India has become one of the top providers of network security solutions, SaaS, and Fintech products.
Segmentation according to industry verticals
Onviqa and other Indian IT outsourcing agencies serve different industries like financial services, banking, manufacturing, telecommunication, healthcare, and insurance. However, the banking and finance companies cover the largest part of the industry segment.
The healthcare sector will grow at a CAGR of around 12%, and it has become more reliant on tech products for the digital revolution.
Segmentation according to export destination
Companies from the UK, U.S, and other European countries buy IT services from Indian companies. Due to its advanced digital capabilities, India has turned out to be the best destination for available IT solutions and software. The IT outsourcing sector in India has earned a revenue of around INR 3,499.28 billion from US companies. However, other countries like Japan and China have also started buying IT services from India.
Final thought: software outsourcing in India
From the above discussion, we can say that there is a bright future of software outsourcing in India. Although there are some adversities because of the recession and the world economy, the outsourcing industry will have a positive effect in the future. The outsourcing industry by 2030 will gain billions of dollars and become the most profitable sector. Although there are several IT firms in India, Onviqa Private Limited is a highly popular destination for software outsourcing in Gujarat and other Indian cities.