It is a well-known fact that the service sector is the strength of India. The country exports more in the domain of services even though it imports in the area of goods. The earnings coming to India in dollars are highly contributed by this sector as it bridges the link between India and the rest of the world. Pradeep Agarwal, informs about the services of IT positively adds to the lower trade deficit. He explains the concept of trade deficit with reference to international trade and says, “The USA imports products made outside their country and sells them in the USA. Simultaneously, it exports products for market overseas. This means that countries are constantly exchanging goods and services, back and forth with each other which has an effect on the trade balances of each country. Therefore, a trade deficit happens when a country’s export is less than its import.”

Furthermore, Pradeep Agarwal clarifies the factors that are the major cause of the trade deficit. He mentions, “In case a country is unable to produce enough that fulfills the needs of its population, the shortcomings are met by bringing in from abroad.” Additionally, he says, “Domestic companies make the most of their production facilities abroad. This implies that their goods are imported when sold to the home market.”

Reckoning on the initial effects of the trade deficit, Pradeep Agarwal states that in the beginning, it raises the norms of living because people have more access to a wider variety of goods. It lowers the inflation threat because products are priced competing with each other. Alongside, it is a prosperous population whose buying capacity exceeds domestic production. Emphasising over the persistent effects he cites, “Outsourcing opportunities are progressively looked upon by Companies. And, local companies start going bust as domestic needs shift to outsourced goods. Also, any country having the issue of trade deficit creates less job opportunities, while more are created in the countries where the imported products are accepted from.”

Considering the benefits due to the IT sector, the software product industry of India is expected to reach USD 100 billion by the year 2025. To expand global track and strengthen delivery centres, businesses are gravitating towards India to invest internationally. Pertaining to which, Tata Consultancy Services declared to enlist a workforce of 1500 in the technology domain across the UK. Eventually, this exercise would result in TCS delivering its services to UK customers in an efficient manner.

Taking into account the revenue, Ministry of Electronics & Information Technology reports that in the last five years, the revenue estimate of the Indian IT industry recorded an increase of around seven per cent. And it was registered at USD 151 billion in FY 2017-18 which was USD 141 billion in FY 2016-17. According to the reports, the IT services exports accounts for the share of 57 per cent of USD 86 billion. In line with that, ER7D and software products appeared to be the second largest segment with approximately 22 per cent share followed by BPO exports that contributes approximately 22 per cent.

The clarification on the scope of intermediary services ensures the exports of R&D in software, business process, management and IT services are not denied ‘export status’, according to the Central Board of Indirect Taxes and Customs (CBIC). The GST refunds will be smoother in that view and hence add to the boost of the Indian IT industry.

India is the predominant out-posting destination for IT companies across the globe. In concluding, Pradeep Agarwal says, “The country has proven its competencies in delivering both on-shore and off-shore services to clients across the globe. Rise in technologies offer a spectrum of new advancements and possibilities to top IT companies.