The proposed US Immigration Bill may have sent jitters to the Indian IT industry but it is still expected to grow at a healthy pace this year. As per industry body, NASSCOM, IT sector in India is expected to grow by 12% to 14% YoY this year. This is higher than the 10.3% YoY growth seen during the previous year. And this is just in US dollar terms. In terms of Indian Rupees, the growth is expected to be much higher. NASSCOM has also stated that it expects IT exports to grow to US$ 86 bn this year.

Growth in exports would be driven by customers moving to new technologies. The question is whether this growth is sustainable or not. We think that in the short term, there maybe hiccups related to protectionist measures adopted in the sector's largest market, US. At the same time the Euro zone too is still struggling. However these are just short term headwinds. The long term growth story for the sector still remains intact.