Providing details on the dominance of software scrips, Mehta added, "The market capitalisation of the software driven IT industry has crossed 15 per cent of total market cap at Indian stock exchanges." He attributed the growing confidence of investors to the handsome performance of the industry.

The Nasscom survey revealed that the IT sector has improved its position considerably over last four years at the stock market. In 1995, IT was ranked 43 in terms of total market cap; it improved its position to rank 23 in 1997; rank 10 in 1998; 2 in March 1999 and onein August 1999. "It is interesting to note that the IT segment has reached the top rank of market cap with the backing of a massive Rs 20,000 crore cap during the first few months of the current financial year," said Mehta.

Reacting to a query on non-software companies trying to include software in their name, he said it would be increasingly difficult to do so as the Registrar of Companies had recently issued guidelines specifying which companies could do so. Nasscom was also was working closely with SEBI to prevent misuse of the "software" name, he added. The organisation was currently in the process of nucleating a rating agency for the software industry for the benefit of investors.

On the continued growth of the industry, he said it could be attributed to growing respect for Indian software expertise, further creation of brand equity of Indian software industry.

He pointed out that contribution of Y2K solution projects to total software exports was almost 20 per cent. Since 1996, the Indiansoftware export industry has executed more than $ 2 billion of Y2K software solutions for the overseas market. It was now focussing on opportunities beyond Y2K including the upcoming segments of E-commerce, Euro, Systems-on-chip and IT enabled services.

The survey said the software industry had not only been growing exponentially but moving up the value chain as well. According to Mehta, the industry had evolved from staffing to software development to integration and IT business consulting. "However, the Indian software industry still requires to move faster on the value chain ladder and get more involved in strategic consulting, brand management for customers, research & development, and providing more web based and e-commerce kind of interactive services to the customers."

The government's decision of continuance of export incentives not only to the software export industry, but also to IT enabled services, has further helped in maintaining high growth rate of software exports from the country, Nasscomsaid.

To help small and start-up software companies Nasscom is planning an IDEAS tour to USA in November 1999. It also planning seminars in Zurich, Brussels, Singapore, London, Tokyo, Johannesburg, New York in the next six months to give a boost to exports. It is building an India pavilion in association with the Department of Electronics at COMDEX, Las Vegas, during November 1999. Over 10 Indian companies are expected to participate in it.

"One of the main strategies for the software industry in 1999-2000 would be to move up the value chain and sow seeds of E-commerce, web-based technologies and interactive integration," he said, adding the strategy would involve more acquisitions of overseas companies by Indian companies.

The survey asked the government to make overseas acquisitions by Indian companies easier and also assist the industry in creating brand equity overseas. "The Indian software industry has the requisite velocity and momentum to achieve the annual US $ 50 billion target by 2008 -- setby the National IT Task Force -- provided the government continues with its thrust towards the sector and continues to remove bottlenecks," Mehta said.

55% growth in Q1

MUMBAI: National Association of Software and Service Companies (NASSCOM), the apex body of the Software Industry in India, today announced that the the first quarter (April - June) of the financial year 1999, generated an export revenue of Rs 3520 crore as against a figure of Rs 2270 crore of software exports during the corresponding period in 1998".

In terms of increase in growth rates, Nasscom's survey indicated that Indian software export industry grew at 55% in the first quarter of 1999-2000. The growth rate in Q1 of last year (1998-99) was 52% over Q1 of 1997-98. Thus, software exports from India continues to grow in the same dynamic manner, as before.

According to NASSCOM study released earlier, the total revenues of the Indian software industry fo the year ending 31st March 1999 (1998-99) was estimated at Rs 15,890 crore(US $ 3.9 billion). Out of this, during 1998-99, software exports grossed revenue of Rs 10,940 crore (up from Rs 6530 crore in 1997-98), while the domestic software market grossed revenue of Rs 4,950 crore (up from Rs 3510 crore in 1997-98).