India’s Tech Industry Sees Steady Growth, With $300 Billion Horizon in Sight

India’s sprawling technology sector, a global powerhouse of software and services, is on track to close the 2025 fiscal year with revenues of $282.6 billion, a 5.1 percent rise from the previous year, according to projections released Monday by Nasscom, the country’s leading IT industry body. The forecast, unveiled at the Nasscom Technology Leadership Forum in Mumbai, offers a glimmer of resilience amid a world roiled by economic headwinds and technological upheaval.

Rajesh Nambiar, Nasscom’s president, struck an optimistic note as he briefed reporters on the figures. “This is a good outcome broadly given everything happening around us,” he said, a nod to the volatile global landscape that has tested industries from Silicon Valley to Bengaluru. Looking ahead, Nasscom anticipates the sector will breach the $300 billion mark in fiscal year 2026—a 6 percent leap from FY25—cementing India’s role as a linchpin in the digital economy.

A Workforce Expands

The industry’s growth extends beyond dollars to people. Nasscom estimates that tech employment swelled by 126,000 jobs in FY25, bringing the total to 5.8 million workers. This expansion reflects India’s enduring appeal as a talent hub, even as automation and artificial intelligence reshape traditional roles. From coders in Hyderabad to engineers in Pune, these workers fuel a sector that spans IT services, business process outsourcing (BPO), and cutting-edge research.

The numbers reveal a varied pace across segments. Traditional IT services, the backbone of the industry, are projected to grow 4.3 percent to $137.1 billion, a steady if unspectacular climb. BPO revenues, meanwhile, are set to rise 4.7 percent to $54.6 billion, buoyed by demand for customer support and back-office operations. The standout performer is engineering research and development (ER&D), which surged 7 percent to $55.6 billion, driven by innovation in fields like automotive tech and aerospace.

Domestic Strength, Global Reach

India’s tech companies are finding fertile ground at home as well as abroad. Domestic revenues are expected to climb 7 percent to $58.2 billion, outpacing the 4.6 percent growth in export revenues, which Nasscom pegs at $224.4 billion. This domestic vigor—fueled by India’s own digital transformation—contrasts with a more tempered global outlook, where export earnings are split evenly between multinational giants and homegrown firms, Mr. Nambiar noted.

The disparity hints at a shifting dynamic: While India remains the world’s back office, its companies are increasingly serving a burgeoning local market. Government initiatives like Digital India, paired with a growing appetite for cloud computing and AI solutions, have spurred demand within the country’s borders. Yet exports, which account for nearly 80 percent of total revenue, underscore India’s outsized role as a global tech supplier, with clients ranging from Fortune 500 firms to Silicon Valley startups.

Navigating a New Era

The projections arrive at a pivotal moment for India’s tech sector, which has weathered a turbulent few years. After a pandemic-driven boom, growth slowed to 3.8 percent in FY24, down from 8.4 percent the prior year, as clients tightened budgets amid inflation and geopolitical strife. Yet signs of recovery are emerging. Mr. Nambiar, a veteran of Cognizant India before taking Nasscom’s helm, sees FY25 as a bridge to a brighter FY26, when revenues could hit that $300 billion milestone—a target once set for this year but delayed by global uncertainties.

For now, the industry’s steady ascent offers a counterpoint to gloomier forecasts elsewhere. As artificial intelligence reshapes workflows and global capability centers multiply across India’s tech hubs, Nasscom’s outlook suggests a sector adapting rather than faltering—one poised to balance tradition with transformation in the years ahead.

This article was written with inputs from PTI.