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Karnataka IT exports to hit $11363.63M
By agencies
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Thursday, 04 May 2006, 19:30 IST
BANGALORE: IT exports from Karnataka, which grew by 36 percent in 2005-06 to reach $9109.31 million, are expected to hit $11363.63 million in the current financial year. Software exports increased by $2272.72 million to touch $8545.45 million, while hardware exports stood at $563.86 million.
The state contributed the maximum with a third of the nation's IT exports of $22911.13 million. Karnataka contributed to 37.6 percent of the nation's exports, up from 34.5 percent last year, said the joint report by Software Technology Parks of India (STPI) and the Karnataka IT department.
Karnataka's IT secretary, M.K. Shankarlinge Gowda, said as many as 70,000 new jobs were created by the IT sector in the State during FY06. About 201 new companies set up shop in the State during the year, of which 124 were 100 percent foreign equity firms.
The minor drop in the number of foreign equity firms (from the previous financial year's 129) is overshadowed by a 17 percent growth in investments by them. The proposed investment by foreign companies stood at $427.72 million, compared to $365.25 million during the last financial year. Total projected IT investment is expected to be $627.5 million.
B.V. Naidu, Director, STPI, said that the State's capital suffers from a crumbling image due to its inadequate infrastructure. Yet, global IT multinationals, such as Bearing Point, Apple Computer, J P Morgan and Caterpillar, set up shop in the State over the last year.
"With new initiatives that the government is taking on infrastructure, more Fortune 500 and $1-billion firms are expected to come to Bangalore," he added. "Criticism about infrastructure will be taken, we are open to suggestions," said Rakesh Singh, Director, IT & BT.
IT-enabled services (ITeS) and business process outsourcing (BPO) were fast growing sectors, and telecom and IC design houses were also moving into the city.
Twenty-five venture capitalist-funded companies were approved during 2005-06. Of the total registered 1,721 firms, over 1,200 were operational and over 200 existing firms expanded their operations during the year.
Even in the hardware front, seven new hardware companies were approved during the fiscal. The hardware industry grew by 40 percent from $401.81 million exports recorded in 2004-05. Growth of over 35 percent is expected next year, said Mr Naidu. Around 100 chip design firms operate in the State.