ITeS to contribute 7 per cent to GDP by 2010: Nasscom-McKinsey report
New Delhi: A joint report released by Nasscom and McKinsey, has said that the information technology industry is projected to contribute around 7 per cent to the country's gross domestic product by 2010 from about 3 per cent today.

The report estimates that the sector would create 8.8-million jobs, directly and indirectly, as against 700,000 people that the sector currently employed.

The export revenue from the sector is projected to more than treble to $60 billion by 2010, compared with $17 billion in 2005. The IT sector would also account for over 44 per cent of the export growth over the next five years, compared with 12 per cent at present, the report said.

While the offshore IT solutions business will grow at 25 per cent to touch $35 billion in export revenues, the BPO business will witness a CAGR of 37 per cent to account for $25 billion of the projected $60 billion.

The report says that the growth will be fuelled by emerging service lines and sectors like traditional IT outsourcing services - the backbone of the Indian IT industry - will grow at a much smaller pace.
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Karnataka seeks centre's approval for hike in service and professional tax
Bangalore: Karnataka is planning to hike service and professional tax and has sought the centre's approval for this. The state has also demanded that the central sales tax should not be abolished.

Karnataka says it would urge the centre to drop its move to abolish central sales tax (CST) in the next two years, since states like Karnataka and Maharashtra which account for a majority of manufacturing sector would lose heavily on tax revenues.

Karnataka expects to lose about Rs2,000 crore in tax revenues if four per cent CST was abolished.
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Decision on FDI in retail within six months says PM
Kuala Lumpur: PM Dr Manmohan Singh has said there would be an early decision on opening up of the retail sector for FDI.

"We will come up with positive outcome in 5-6 months," the PM told business leaders ahead of his meeting with Asean leaders and the East Asia Summit.

Dr Singh admitted there were problems on opening up the retail to FDI as the government faces stiff opposition from its Left allies on FDI in retail apart from hike in the foreign investment limit in insurance.

The PM also said that though finance minister P Chidambaram announced a hike in FDI in insurance from 26 to 49 per cent, it could not be done as the IRDA Act has to be amended for this purpose.
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IIP down to 8.5 per cent in Oct
New Delhi: The index of industrial production (IIP) was down to 8.5 per cent in October as against 10.6 per cent in the corresponding period a year ago due to a slowdown in manufacturing coupled with a plunge in the mining sector.

The manufacturing sector grew by a slower 9.6 per cent during the month as against 11.9 per cent in October 2004. Growth in the mining sector fell down to a negative 1.8 per cent during October this fiscal compared to a respectable 6.2 per cent in October 2004-05.

The index of industrial production (IIP) would have been even lower but for the improved performance in the electricity sector, which posted 7.4 per cent growth in October 2005 as against 3.5 per cent in the same month last fiscal.

During the first seven months of this fiscal, the index rose by a slower 8.4 per cent compared to 8.7 per cent during April-October 2004-05, according to official data released on Monday.

In April-October 2005-06, manufacturing witnessed higher growth at 9.6 per cent compared to 9.1 per cent during the corresponding period of 2004-05.

The mining sector posted only 0.7 per cent growth so far this fiscal compared to 5.3 per cent in the same period last fiscal while electricity also recorded lower growth at 5.2 per cent this fiscal compared to 7.1 per cent in April-October 2004-05.
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Nasscom-McKinsey report says software exports will grow at 25 per cent
New Delhi: The revenue from software services exports is likely to grow at 25 per cent year-on-year till 2010 to touch $60 billion, according to Nasscom-Mckinsey Report 2005.

India can generate software export revenues of nearly $60 billion by 2010 out of the total $110 billion that is projected to be offshored by global companies to various countries, the report adds.

The total addressable market for global offshoring is $300 billion of which $110 billion will be offshored by 2010. India has a potential to capture more than 50 per cent of this opportunity, it notes.
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