What are the main socio-economic implications arising out of the development of IT industries in major cities of India? UPSC GS Paper 1 2021, 15 Marks

Q17. भारत में प्रमुख शहरो में आई.टी. उद्योगों के विकास से उत्पन्न होने वाले मुख्य सामाजिक – आर्थिक प्रभाव क्या हैं ? (250 शब्दों में उत्तर दीजिए)

Q17. What are the main socio-economic implications arising out of the development of IT industries in major cities of India? (250 words) 15 Marks


The twenty-first century is expected to be dominated by information technology, with India at the center of global attention and regarded as a knowledge powerhouse. IT services, IT-enabled services (ITES), e-commerce (online business), software, and hardware products are all part of the IT industry.

In this competitive world, IT-based services are essential for any organization to increase productivity, ease of doing business, and grow efficiently and economically. Not only has information technology contributed to the country’s economic growth, but it has also made governance more competent and approachable. It has simplified and reduced the cost of obtaining government services and information.

Cities house nearly 31% of India’s current population and account for 63% of GDP (Census 2011). By 2030, urban areas are expected to house 40% of India’s population and contribute 75% of India’s GDP. This necessitates the creation of comprehensive physical, institutional, social, and economic infrastructure.

All of these factors contribute to improving the quality of life and attracting people and investment, thereby initiating a virtuous cycle of growth and development. India’s IT sector will play an immense role to make it a reality.

Socio- Economic Implication arising out of the development of IT Industries in Indian Cities

  • Demographic Dividend: India’s IT sector has huge potential. Due to high demand majority of Indian youth are acquiring skill sets on par with IT sector. Due to this India is moving towards to direction of skills economy. More youth are getting employment in this sector, which will contribute to the overall growth of the Nation.
  • Good Governance: India’s strong IT sector opens the door for policymakers to utilize ICT technologies to solve the socio economic issues of the nation. JAM, Digital India, Smart cities program etc. are the steps in the direction of Good governance, which would not have implemented efficiently without strong IT Industries.
  • Improving criminal Justice system: IT sector has various positive implications. Digitalization of criminal justice system has the potential to address various social problems.
  • Boost to Start ups: IT sector has brought the startup culture. Cities like Bangalore and Hyderabad are tagged as start-up hubs of India. This generates immense employment opportunity. India can also become major power in services sector if India startups are getting a conductive environment to grow. India is the world’s leading sourcing destination, accounting for approximately 55% of the US$ 200-250 billion global services sourcing business in 2019-20.
  • Reducing Disparities: Stand up India is government of India’s flagship program to promote entrepreneurship among SCs and STs community. This will reduce the disparities prevailed in the Indian society. This also shows that IT sector is leading towards Inclusive growth.
  • Addressing environmental issues: Industry 4.0 has the potential to solve the prevailing climate change problems. Air and water pollution are the most alarming problems in various Indian cities. Growth of IT sector will lead to innovations, which in turn solve these alarming issues.

Way Ahead

India is the world’s most popular offshoring destination for IT firms. After demonstrating its ability to deliver both on-shore and off-shore services to global clients, emerging technologies now provide a plethora of new opportunities for top IT firms in India. By 2025, the Indian IT and business services industry is expected to be worth US$ 19.93 billion. All the stake holders must work collectively to nurture India’s IT sector.

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