CHENNAI (TIP): Software industry body Nasscom expects the country’s information technology (IT) services sector to grow 13-14 per cent in the current financial year and to touch $225 billion (Rs 13.22 lakh crore) by 2020. Speaking to reporters after addressing Nasscom’s EmergeOut Conclave here, the industry body’s president, Som Mittal, said the sector had been growing at a compound annual growth rate of 12-13 per cent till two years earlier, and reaching the $225 billion target was not impossible.

The first main driver will be new geographies. At present, the US, the UK and other European markets contribute to around 90 per cent of the total business, while other markets, including India, China and Latin America, contribute the rest. “Only three per cent of the business we do in China and Japan, which shows there is plenty of opportunities in those markets,” said Mittal. Many small companies have now started focussing only on these markets. “Our estimate is that around 20 per cent of the business would come from new geographies by 2020,” said Mittal. The second driver will be new verticals.

At present, banking, financial services and insurance, hi-tech and telecom and manufacturing contribute around 80 per cent of the business, while utilities, transport, health care and media and entertainment open up new opportunities. “Not that the existing verticals will have a setback. The growth will not be at the cost of others, it will be an an expansion,” said Mittal. The third driver will be new customers, especially small and medium business companies, said Mittal.