Industry body Nasscom on Wednesday released the findings of a survey of 100 Chief Executive Officers (CEOs) of information technology companies showcasing “cautious optimism” due to global economic uncertainties like trade wars, Brexit and currency fluctuations.
“As per the survey, global economic uncertainties are leading to a cautionary outlook among CEOs, but they expect digitization initiatives to continue with the same momentum,” Nasscom said in its survey report without giving any guidance for industry’s growth in 2019-20.
Among the emerging challenges, the report listed trade wars and policy uncertainty, currency fluctuations, no deal Brexit, weakening financial market sentiment and regulatory changes in new technology as the major challenges for 2019 and beyond.
“Global economic uncertainties are leading to a divided outlook, wherein 50 percent CEOs believe that the global economic and business outlook will be lower than 2018 and 50 percent believe it will be similar or better,” the report said while predicting the scenario for 2019.
The information technology (IT) trade body was expected to issue its outlook for the industry in 2019-20. However, it came out with the survey report talking on various aspects of the industry, sharing a wide perspective but falling short of giving guidance.
“Nasscom will not release its guidance even later… (The survey) presents a perspective in its naked form and you can interpret from that as you like,” Nasscom Chairman Rishad Premji said on the sidelines of the three-day Technology and Leadership Forum 2019.
The findings of the first edition of the CEO Survey, Nasscom CEO Survey 2019, showcase “cautious optimism” among the chieftains of IT firms and found that digital opportunities and digital skills will pave the future of the IT-BPM industry in India.
“While 51 percent of CEOs feel that the year ahead will be similar or somewhat lower than 2018, 49 percent believe that the year will be better. Digital transformation journey is likely to be less impacted from global macroeconomics,” Nasscom said.
The report further said that almost 90 percent of the CEOs feel that tech hiring will be similar or somewhat better than in 2018. There will be an increased focus on skilling and reskilling in the sector as businesses deal with the global tech skills shortage.
“Increased protectionist policies and lack of digital skills are the two key risks that can hinder the growth of the sector,” it said.
Fiscal 2018-19 was an exciting year for the industry, as the export sector crossed $137 billion in revenues and marginally grew above the Nasscom guidance of 7-9 percent, the survey report said, adding that the total revenue crossed $180 billion in FY19.
“In summary, CEOs are cautiously optimistic about the sector. However, the impact of global macroeconomic risks can pose challenges for growth,” it added.