North
America may account for the lion's share of India's IT exports but,
growing demand for outsourcing services from Europe is expected to drive
the $108 billion IT sector in 2014, industry body Nasscom said.
"Europe
is growing faster than the US. That is something we saw this year and
this will only gain momentum. There is a lot of latent demand in the
region, which will drive growth for the sector," Nasscom President Som
Mittal told PTI.
North America accounts for over 60% of revenues
of Indian IT exporters, while the European region contributes about 20%
with the UK making up for the bulk of that share.
"The share of
the European region has been growing... The market is now more open to
outsourcing and in the coming year, we will see a lot of new projects
coming up, which is a huge opportunity for our domestic companies," he
said.
Indian IT companies are also ramping up presence in Europe
as they face uncertainty in the US market, where new immigration laws
could drive up costs of sending workers on short-term visas.
"The
companies are bullish on the European market, which is evident from the
acquisitions that some of them have made in the recent past," he said.
Indian
companies have also been acquiring local firms to address labour issues
and increase pace of growth in Europe. These include TCS' acquisition
of French IT services firm Alti for Rs 530 crore, Geometric acquiring
3Cap Technologies for 11 million euros and Infosys buying Swiss
consulting company Lodestone for $350 million last year.
US-based
Cognizant, which has 75% of its workforce based in India, acquired six
small IT services companies (part of Germany's C1 Group) for an
undisclosed sum.
"For European companies, many of them which
have seen prolonged economic slowdown, Indian IT firms not only offers
cost advantage but also high quality of work," Mittal said.
Nasscom
expects the domestic IT sector to grow by 12-14 per cent, while IT
exports are likely to reach USD 86 billion in the current fiscal ending
March next year on the back of adoption of new technologies and tapping
new geographies by corporates.