COVID-19 and the IT sector in India by Ananya Ganeriwalla C'24
With nearly eight million cases of Covid-19, the emotional and physical health of many Indians is continuing to deteriorate. Like in most countries, the onset of Covid-19 brought about significant pain to India with small businesses, particularly vendors scattered across the country, and entrepreneurs growing financially weaker each day. However, as the Indian subcontinent continues its efforts to mitigate the impacts of Covid-19, there is one industry that’s benefiting: the Information Technology (IT) sector.
In India the IT sector has been perhaps the most widely grown professional sector since 2000. Employing primarily engineers and software developers, the IT sector accounts for nearly 7.7% to 9.5% of India’s National GDP. Indian Prime Minister Narendra Modi describes the industry as a source of national pride.
And the emergence of Covid-19 has fortified that. While other industries are under dire economic pressure, the IT industry is projected for 2% growth in revenue for this fiscal year alone. Covid-19, the virus that has weakened or even eliminated entire industries, has been so economically beneficial for the IT sector due to the nature of the industry itself.
When Covid-19 started to gain momentum, the IT industry, similar to other industries, realized the need to transfer their services to be remote by “speed[ing] up movement of the cloud.” In other words, the IT industry needed to shift their enterprise software, data, and processing to remote servers in order to cut down costs. And luckily, unlike other physical industries, the digital IT industry had the resources to do it.
Essentially, there was a forced development of the IT industry. The capabilities for this evolution were always there but the incentive was not until Covid-19.
With increasing technology and digital capabilities, the IT industry has significantly improved its efficiency and quality. New employees have faced higher expectations to have honed their skills, be able to develop new programs, and overall improve the flow of industry that previously faced setbacks due to poorer software and limited technological access.
And this has all come at an interesting time. With Covid-19 unlikely to fully resolve in the immediate future and a new sense of normalcy to set in, the IT industry is considering transition to a fully remote environment. Working from home expands the resources and capabilities of employees, leading to further developments and thus increased growth overall.
With Modi aiming to encourage “young talent” to join the ever-evolving industry and an increasing shift to urban environments and technology-based occupations throughout the subcontinent, Covid-19 may have radically altered the spectrum of jobs available in the Indian subcontinent. However, as a country still struggling with extreme poverty, the growth of a uniquely urban industry has come at the expense of the downfall of other industries. The potential for the growth of the IT industry to widen the wealth and technological gap between the urban wealthy and rural poor exists. The question then arises whether this perceived economic boon will be worth it in the long term.
Ananya Ganeriwalla is a freshman in the College of Arts and Sciences, intending to pursue Mathematical Economics. Her interests include economic development, accessibility of educational opportunity, and tangible policy change. In her free time, she enjoys running, reading, and engaging in thought-provoking discussions.