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India ict market insights sept2015
- 1. India: Market Snapshot “Doing ICT Business with India” Nicola Watkinson Senior Trade & Investment Commissioner 23 September 2015
- 2. INDIA – a major global economy US$ 2.01 Trillion economy 11th largest global economy, poised to be the 3rd largest by 2030 Australia’s 7th largest export market Home to a number of the world’s leading corporates Outbound Foreign Direct Investment has grown from A$5.1 billion in 2003-04 to A$43 billion in 2013-14
- 3. Australia Unlimited Australia and India - Economic Relationship • Two-way goods & services increased from $6.8 - $14.8 bn (FY03-14) • Indian investment in Australia approx. A$11 bn • Over 100 Indian companies in Australia • Free Trade Agreement could result in increase in Australia's GDP by up to US$32 billion (A$45.5 billion) and India's GDP by up to US$34 billion (A$48.3 billion) over a period of 20 years (Independent modelling conducted in 2008 on the Australia–India CECA) • Approx. 450,000 people of Indian descent live in Australia • Around 150 Australian companies with representation in India
- 4. Australia Unlimited Australian ICT companies in India
- 5. Australia Unlimited Australia – India Partnerships in Research • Max Healthcare - Deakin • IIT - Monash Centre in Mumbai • TERI - Deakin Nanobiotechnology Centre • Thermax, CSIRO Australia & University of New South Wales • Department of Biotechnology, Govt. of India & Queensland University of Technology • Australian Cochlear Ear Implant by Defense Research Development Organisation • Australian solar manufacturer Dyesol partnership with Tata Steel • ABB’s joint research initiative between its Indian and Australian operations and RMIT • AgTechnix’s technology by Hyderabad based SeedWorks India • Rio Tinto and iGATE Patni – dedicated R&D centre in India
- 6. Australia Unlimited Indian IT companies in Australia • More than 25 Indian IT firms in Australia • Big 6 already represented in Australia providing over 8,000 knowledge- based jobs • Positive revenue growth compared to other OECD markets is generating interest • Seeking to move up value chain, presenting opportunity to commercialise Australian research and integrate start-ups into their supply chain • Offer investment funds through corporate VC arms and a path to global markets as 80% to 90% revenues from Fortune 500 customers in the US and Europe
- 7. Australia Unlimited The Big 6 India IT companies – reach & capacity to invest • Tata Consultancy Services (TCS) - US$ 15 billion revenue, 45 countries, Co-Innovation Network – partner with international academic & research institutions, start-up companies. • Cognizant Technology Solutions - US$ 10.26 billion, 40 countries, Global Technology Office tracks technology trends, invested in Melbourne mobile solutions company, Odecee • Infosys - US$ 8.7 billion revenue, 50 countries, Centre of Emerging Technologies partners for new technology development, created Infosys Innovation Fund worth US$500 million and is partner in Australia's Smart Services CRC. • Wipro - 8 billion revenue, presence in 57 countries, 55+ dedicated emerging technologies ‘Centres of Excellence’ & Innovation centre in Bangalore, created a $100-million venture capital fund, Wipro Ventures , invested in NSW analytics company, Promax Applications • Tech Mahindra - US$3.7 billion revenue, 52 countries, created US$150-million Growth Factories fund. • HCL Technologies - $6.7 billion revenue, 31 counties, parent HCL has recently floated $500M health tech fund to evaluate US based health technologies.
- 8. Australia Unlimited Indian IT industry - strong contribution to India GDP Share Highest relative share in national GDP 9.5% 3.5 mnEmployees Largest private sector employer Diversity Ardent promoter of diversity >1.2 mn Women Exports Largest share in total services exports >38% 55%Leading global sourcing destination Market Share Magnet for PE/VC investments 53% USD 6 billion Investments Source: NASSCOM
- 9. Australia Unlimited NOTABLE TRENDS IN INDIAN IT SECTOR INTERNATIONALIZED - 580 global deliverycentres,75 countries, 92% revenues US, UK & Europe SMAC TECHNOLOGIES - expected to grow to USD 225 bn (2020) INCREASED R&D FOCUS - TCS US$ 35 mn investment in Carnegie Mellon Uni LARGE PLAYERS GAINING ADVANTAGE top 6 =50% of the market DIGITAL REVENUES & INVESTMENTS - quadrupled in 5 yrs & 110+ M&A’s CONSUMERISATION OF IT - moved up value chain beyond outsourcing UPTICK IN HIGH VALUE ADDED SERVICES - ER&D revenue US$20 bn Source: Booz and Company, NASSCOM
- 10. Australia Unlimited Opportunities - Indian government’s digital push Government Investments in Technology-2014-15 Digitisation Infrastructural improvements Push for Manufacturing Technology in healthcare & agriculture Source: McKinsey, Zinnov NASSCOM Initiatives Healthcare IT Platform Partnership with NATHEALTH and Ministry of Health to build centralised Healthcare IT Platform Smart Cities NASSCOM and Industry helping to define IT Architecture for 100 Smart Cities Initiative Digital India Catalyse Digital Literacy and partner for Digital India Defence R&D Industry collaboration for Defence R&D Technology Make in India Software Products leading Make in India; IOT Lab
- 11. Australia Unlimited Opportunities for Australian companies • Food Drivers 1. Improper handling - 40% losses at farm gate 2. Yield fluctuation - lack of precision farming methods, supply chain management & infrastructure 3. Agriculture, livestock, forestry and fishery 16.1 % of the Gross Value Added (2014-15) 4. Focus - canned, dairy, processed, frozen food to fisheries, meat, poultry, and food grains 5. Food grain production - 251.12 million tonnes 6. Largest milk producer (138MT annual) & largest bovine population. Technologies - Cloud, sensor, GPS for resource allocation, decision making to improve productivity, yield, reduce operational costs and emerging opportunity for automation technologies in production. Drivers 1. Improper utilisation of natural reserves – coal, LNG, solar 2. Mining sector challenge to re-boot operations after recent ban for increasing production, productivity & improve the environmental footprint 3. 4th largest energy consumer after US, China, Russia & 300 million people have no access to electricity Technologies - supporting reduction in mining operational costs (cloud, systems integration, mobility), remote automation, monitoring & visualisation of activities (reducing wage/ FIFO mine costs, supporting decision making), resource monitoring (via sensor networks and visualisation) and simulation (worker training and decision making) MINING, OIL & GAS AGRI FOOD Source: IBEF
- 12. Australia Unlimited Opportunities for Australian companies • Food • Food Drivers 1. “Make in India” initiative – aim to increase manufacturing output from 16- 25% GDP (2025) 2. Manufacturing Industry presents USD 8 billion opportunity for ICT sector (2017) 3. Indian automotive sector – current value US$ 90 billion, 3 million passenger cars per year 4. Civil aviation sector growth of over 41% in passenger traffic in 2 years 5. Ranks 8th globally in military spending & US$ 4 bn to be invested in defence over 7-8 years 6. 3rd largest armed forces globally(budget US$ 37.3 billion in 2014), focus on Armed Forces Modernization and Defense Offsets Technologies - Air & ground traffic management, security systems, cyber security, optimization, big data, mobility, cloud computing, The Internet of Things, simulation. Drivers 1. Shortfall in electricity generation, energy cost is driver for energy efficiency solutions 2. Ambitious target to increase capacity to generate 55 GW RE by 2022 3. Government action mandating reduction targets in high energy industries, trading mechanism 4. National Smart Grid Mission -130 mn Smart Meters(2021).14 Smart Grid Pilot Projects underway 5. National Mission for Clean Ganga - US$ 400 mn programme to clean 10 river front towns/cities 6. 16% of worl’d population & 4% water resources – demand to rise by 20% in 2020 7. Environment technologies market valued at US$ 14.29 bn Technologies - successful integration of intermittent renewable energy into grid, smart systems for energy generation, management, transmission and usage, monitoring, simulation, water utilization & treatment, waste management, capture and reuse solutions. MANUFACTURING RENEWABLES, & ENERGY EFFICIENCY WATER Source: IBEF
- 13. Australia Unlimited Opportunities for Australian companies • Food • Food Drivers 1. Health expenditure only 4 per cent of GDP (2012) 2. Capacity constraints - 700,000+ beds required in 6 years, investment opportunity of US$ 25-30 bn 3. Increase in lifestyle diseases 4. Industry growth around 14 % pa rising from US$70 billion to US$280 billion (2020). 5. Aged care - 320 million citizens over 60 yrs, 48 million people over 80 yrs (2050) 6. Reach - 70% of India’s population lives in rural areas Technologies - Commercialise Australian research, med technologies & collaborate on data analytics, and bio-informatics, remote locations services - e-health, tele-medicine, remote monitoring, and remote diagnostics. Drivers 1. Services sector accounts for 57% GDP 2. Banking assets US$ 1.8 trillion (FY14) & to be US$ 28.5 trillion (FY25) 3. Mutual fund industry on all-time high of US$ 189.83 billion 4. Equity funds had inflows of US$ 825.49 million 5. Life insurance sector biggest in the world & 15th largest insurance market in terms of volume Technologies - systems integration & optimisation across the financial services, banking & insurance sectors, cyber security and privacy systems, payment technology, multi-channel customer support platforms and software to support regulatory reporting. HEALTH FINANCIAL SERVICES Source: IBEF
- 14. Australia Unlimited • Food Opportunities for Australian companies Source: Ernst and Young 2015; PWC 2015, IBEF Drivers 1. Cities - 100 Smart cities program - US$ 10bn per city 2. Road Safety - loss of >150,000 lives & >500,000 road accident every year, considerable budget allocated by State governments & international agencies for safety technologies 3. Rail - modernisation of rail network including safety, operational and energy efficiency, investment of US$93 billion in capacity addition (12th Five-Year Plan - 2012-17) 4. Ports - modernization of port infrastructure, transformation in to world class ports & improvement of hinterland (port connectivity highway project US$ 310 million) Technologies - support operational efficiencies, remote resource monitoring (visualisation, simulation to maximise efficiency of loads and handling) systems integration mobility (cloud) technologies, intelligent transport systems and technology, predictive analytics, sensor technologies, smart grids, smart meters, simulation systems, safety
- 15. Australia Unlimited Pathways to market Australian ICT exporters Niche applications for Indian domestic market Strategic alliances with India’s IT majors to support international customers and markets Australian research institutions and technology Attract Indian investment into Australia’s innovation development - R&D strengths and commercialisation potential Australian research and innovation hubs / centres Create linkages with Indian business, universities, research bodies & government. VET providers Participate in digital upskilling of Indian IT sector
- 16. Australia Unlimited Profiling Australian capability to India
- 17. MEETING WITH INDIAN SYSTEMS INTEGRATOR AUS COMPANIES IDENTIFICATION & OPPORTUNITY COMMUNICATION INDIA VISIT BY AUSTRALIAN COMPANY VIDEO CONFERENCE CONNECTION AND DISCUSSION OF BOTH PARTIES RE-SELLER AGREEMENT SIGNED + FIRST CONTRACT AWARDED Australian Hospital Mgt software for Indian market INFORMATION ON MARKET & CUSTOMER PROVIDED LEVERAGED STATE GOVT AND INDUSTRY ASSOCIATION NETWORKS FREQUENT MARKET VISITS TO DEMONSTRATE COMMITMENT INDIAN COMPANY SITE VISIT TO AUSTRALIA VISIT BY AUS TECHNICAL PERSON TO INDIA FOR 6 WEEKS
- 18. LARGEST INDIAN IT COMPANY CONTACTED AUSTRADE TO IDENTIFY TECHNOLOGY PROVIDERS FOR GLOBAL CUSTOMERS LINED UP > 50 AUS IT START-UPS INDIAN COMPANY TECHNICAL TEAM REVIEW AND SHORTLIST State Govts, ICN, Enterprise Connect, Commercialisation Australia, NICTA Opportunity for IT Start Ups to be a part of global supply chains AUSTRALIA SITE VSIIT BY INDIAN COMPANY DECISION MAKERS FOR DETAILED DISCUSSIONS OUTCOME: Agreement between Australian start-ups and Indian IT major for the US and European markets
- 19. Australia Unlimited How Austrade can help you Our strength is in our NETWORK Austrade has 10 offices in India & strong industry contacts in major centres and Tier II cities Our network provides market insights to Australian companies entering the market to help them select the: • projects • partners • locations to give them the greatest chance of success
- 20. Austrade India IT team Amanda Hodges Trade and Investment Commissioner, Mumbai [email protected] Malini Dutt Investment Manager, Mumbai [email protected] Grace Ann Lobo Investment Manager, Mumbai [email protected] Nicola Watkinson Senior Trade and Investment Commissioner [email protected]
- 21. Australia Unlimited Key IT events/activities - FY 2015/16..don’t miss the opportunity! • October - November 2015: Australian IT Innovation and Technology Virtual Showcase to India 2015 - Applications close on 15 Oct 2015 • February 2016: Australian ICT CoE Mission to India - Presenting Australian IT centres of excellence to Indian multinational corporations • Marketing & Media campaign - Austrade India innovation website • Independent market visits by Australian organisations • Indian companies (Customer and Investor) Targeting and Profiling followed by Australia site visits
- 22. Thank you