The Hindu Business Line : Record rise in MNC investments: Nasscom

Despite rising concerns on gaps in talent and infrastructure impacting the country's competitiveness in emerging as a leading destination for IT and BPO services, the year 2006 witnessed an unprecedented rise in MNC investments, said Nasscom's year-ending report.

With leading firms having reported growth above expected rates in the first half of the fiscal year, industry performance remained buoyant. Firms continued with their steady expansion into newer service lines and increased geographic penetration.

While there has been a mixed response on offshore outsourcing, the software body is of the view that there was a shift in global perspective from being protectionist to considering a more rational view, in the light of economic compulsions.

This changing perspective also took into account the value addition accrued to the company through outsourcing, as well as the possible risks incurred in the process.

Further, to retain the country's competitiveness, there had been proactive efforts by industry players and concerned government bodies.

As a result, while alternate destinations were being explored to add multi-country delivery capability, India remains an integral part of any major global sourcing strategy, said Nasscom.

Export target

According to market indicators, there was scope for renewal of IT-BPO mega deals.

It indicated that it would make it easy for the industry to achieve the target of $60 billion in exports by 2010. Exports are expected to demonstrate growth rates between 28 and 30 per cent in 2006-07.

Yet, the size and scope of this opportunity, and the strategic advantages in realising its potential — are significantly larger, said Nasscom.