SDG 8: Decent Work and Economic Growth | SDG 9: Industry, Innovation and Infrastructure
Institutions: Reserve Bank of India (RBI) | Ministry of Finance
The Reserve Bank of India (RBI) has released data from its annual survey on Computer Software and Information Technology Enabled Services (ITES) Exports for 2024–25, revealing robust growth and shifting geographical trends.
Key Figures and Overall Growth
Total Export Value: Exports of software services (excluding sales through overseas commercial presence) are estimated to have reached US$ 204.7 billion in 2024–25, up from US$ 190.7 billion in the previous year.
Annual Growth Rate: This represents a year-on-year growth of 7.3 per cent.
Sectoral Contribution: When including the services delivered by foreign affiliates of Indian companies (commercial presence, Mode 3), the total software export services stood at US$ 218.6 billion, marking a 6.5 per cent increase.
Survey Coverage: The survey contacted 6,766 companies, with 2,206 companies responding, including most of the large firms. The participating companies accounted for approximately 90 per cent of the total software services exports.
Segmental and Organizational Shifts
The data highlights changes in which services and types of companies are driving growth:
Dominant Service Activity: Computer services remain the largest component, constituting 67.4 per cent (US$ 138.1 billion) of India’s total software services exports.
BPO services were the major component of ITES exports, contributing 27.3 per cent (US$ 55.8 billion) of the total software exports.
Engineering Services accounted for 5.3 per cent (US$ 10.8 billion) of exports, seeing a slight increase in its share.
Organizational Driver: Private limited companies emerged as the primary growth engine, recording a substantial growth of 11.6 per cent in total software services exports. In contrast, exports by public limited companies increased only marginally by 1.3 per cent. As a result, the share of private limited companies in total exports rose to 60.1 per cent.
Geographic and Delivery Trends
Significant trends are visible in the geography of service exports and the modes through which they are delivered:
Geographic Diversification (Crucial Highlight): Exports to Europe increased at a faster pace of 14.3 per cent compared to the growth of 4.9 per cent recorded for the United States of America (USA).
The share of the USA declined from 54.1 per cent to 52.9 per cent.
The share of Europe increased from 30.8 per cent to 32.8 per cent.
The United Kingdom was a major growth area within Europe, increasing its share to 15.5 per cent.
Delivery Mode: The off-site mode remains the overwhelmingly dominant method of service delivery, accounting for 90.7 per cent of total software exports.
Invoicing Currency: The US Dollar (USD) remains the principal invoicing currency, constituting 72.0 per cent of India’s software exports. The Euro followed at 9.6 per cent, with the Indian Rupee (INR) making up 7.1 per cent.
Foreign Affiliates and Modes of Supply
Cross-Border Supply (Mode 1): The contribution of cross-border supply mode (Mode 1) in total software services exports increased from 83.5 per cent in the previous year to 84.8 per cent in 2024–25, signifying high efficiency in remote delivery.
Foreign Affiliates (Mode 3): Software business conducted by foreign affiliates of Indian companies (Mode 3, commercial presence) totaled US$ 13.9 billion, with the largest local business conducted in the USA (US$ 13.9 billion reported locally).
The comprehensive data confirms that India’s software and ITES export sector is not only expanding but is also strategically diversifying its client base toward Europe, enhancing resilience against any single-market slowdown. Furthermore, the strong growth by private limited companies and the continued dominance of cross-border (Mode 1) supply, which accounts for 84.8 per cent of all software services exported, underscore India’s status as a leader in digital service delivery.
What is Mode 1 - Cross-Border Supply? → Mode 1 is the most common way India exports software and IT services, accounting for 84.8 per cent ($185.4 billion) of its total software exports in 2024–25. This method is essentially digital delivery or remote work on a global scale, where a service (like coding or data processing) is supplied from India to a client abroad without the supplier or the consumer having to cross borders. The work is overwhelmingly performed off-site in India, a practice that contributes to 90.7 per cent of total software exports, highlighting the country’s high efficiency in remote service delivery. This mode underscores India’s dominance as a hub for digitally delivered services, allowing for cost-effective and scalable operations for foreign clients.
What is Mode 3 - Commercial Presence?→ Mode 3 involves an Indian company establishing a commercial presence in a foreign country, such as opening a branch or subsidiary, to provide services locally. This method allows Indian IT firms to be physically present in markets like the USA or UK to build direct client relationships and tailor services to local needs. The software business conducted by these foreign affiliates contributes significantly to India’s overall export revenue, accounting for $13.9 billion in 2024–25. This physical footprint abroad is categorized as “locally” supplied software business and is a crucial part of the total software exports, ensuring the Indian IT industry maintains global reach and direct market access
Follow the full update here: Survey on Computer Software and Information Technology Enabled Services Exports: 2024-25