Export-led growth has been the mainstay of the spectacular performance of the Indian software industry. However, continued growth at the blistering pace set in the 1990s faces significant challenges in the form of growing scarcity of talent, rising wage costs and emerging competition. Besides, the recent slowdown in the US has lowered growth estimates for the infotech industry. The Indian software industry cannot afford to be complacent if it wants to maintain its position as a premier purveyor of software services. The industry will need to consolidate its strengths and move up the value chain if it is to maintain its head start on the competition. Most importantly, it will have to invest substantially in R and D and create linkages to encourage career prospects for researchers in engineering.
