IT hubs of the country were reeling under a slowdown in the West in 2009, Gujarat’s disadvantage turned into an edge. IT exports from the state have grown by an impressive 72% year-on-year in 2008-09.

Data available with Software Technology Park of India (STPI), a nodal agency set up by the Central government to promote software exports, indicates that while exports from Gujarat have consistently grown over the past three years by over 20 per cent, during recession-hit 2008-09, it skyrocketed from Rs 740 crore in 2007-2008 to Rs 1,270 crore in 2008-9, a jump of over 70 per cent.

“The meltdown helped Gujarat-based small players as many US companies chose to outsource work to reduce costs. These companies preferred smaller companies over biggies due to competitive rates offered by them. Most IT firms in Gujarat are SMEs,” said Ravi Saxena, principal secretary, science & technology. Exports have already crossed Rs 1,000 crore in the first three quarters of the current fiscal, says Ajay Sharma, director, STPI (Gujarat).

Large companies like TCS expanded their footprint in the state, which further augmented outsourcing business, said Nirav Shah, president of Gujarat Electronics & Software Industry Association.

And, it were not just firms in the space of Business Process Outsourcing, Knowledge Process Outsourcing and call centres that gained. “Gujarat companies are building good reputation in the field of Engineering Design Software (EDS),” said Chirag Mehta, managing director of a software company. A chunk of EDS business came from Australia, USA and UK companies.
Software export from Gujarat was mere Rs. 4.75 crore in 1996 and until 2000 exports remained below Rs 10 crore. “Software exports crossed Rs 450 crore in 2004-05 due to improved infrastructure,” said Sharma.

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