New Delhi: Share of US and Canada in India's exports of computer software and IT Enabled Services (ITES) has come down from 63.78 per cent in 2002-03 to 61.68 per cent in 2003-04, a study said today (Sep 26, 2004).

The study by Electronics and Computer Software Export Promotion Council, however, says export of software and services to US will grow at the rate of 20 per cent per annum in coming years.

While the share of US and Canada in India's exports of software and services is coming down, the share of Europe and Japan has shown an upward swing during 2003-04.

"This only shows that export penetration in alternate markets is picking up," said a statement by ESC.

Stating that ESC has been taking effective steps to broad-base Indian exports to reduce over-dependence on the US market, ESC executive director D K Sareen said, "This is a good hedge against risk to software exports from India."

Sareen said that India's export to the US and Canada, in absolute terms, have gone up from Rs 29,658 crore in 2002-03 to Rs 35,777 crore in 2003-04, an increase of 21 per cent in rupee terms and 27 per cent in dollar terms.

"This has happened despite the campaign in US against business process outsourcing," he said.

Sareen said that the software and services exports to the US will grow at an average rate of 20 per cent in the coming years and India will continue to be the most sought after outsourcing destination for the US companies.

Share of Europe in Indian IT exports has gone up from 22.79 per cent in 2002-03 to 25.09 per cent in 2003-04.

In absolute terms, export to Europe has picked up from Rs 10,597 crore in 2002-03 to Rs 14,545 crore in 2003-04, showing a growth of 37 per cent in rupee terms and 44 per cent in dollar terms.

The increase in market share to the European market was to the tune of 10 per cent in 2003-04, as compared to the previous year.

Share of exports of computer software and services to Japan and other Far-East countries also has gone up in 2003-04 to 5.36 per cent as against 4.44 per cent recorded in 2002-03. In absolute terms, India exported software and services worth Rs 3,110 crore in 2003-04 to Japan and the Far-East as against Rs 2,065 crore in the previous year, registering a growth of 51 per cent in rupee terms, while in dollar terms it was 58 per cent.

Sareen said that this is a testimony to how effective the ESC-initiated programme of Language Related Market Access Facilitation Initiative was in the Japanese market, launched some two years back.

The objective of this programme is to acquaint the Indian IT professionals, software exporters and students of technical institutions with the proficiency in Japanese language and business etiquette, which is critical to do business there, he added.

Software exports to Latin America also showed a significant increase.

In absolute terms, exports have picked up from Rs 51 crore in 2002-03 to Rs 71 crore in 2003-04, spurting up by 39 per cent in rupee terms and 46 per cent in dollar terms.