Union Finance Minister Nirmala Sitharaman on Sunday projected India as a global leader across software development services, IT-enabled services, knowledge process outsourcing and contract research and development, placing the country’s digital capabilities at the centre of its economic strategy as governments and corporations accelerate technology adoption.Speaking at a public interaction following the Union Budget presentation, Sitharaman said India’s technology sector has moved beyond cost arbitrage to deliver complex, high-value solutions, backed by scale, skills depth and mature delivery models. She pointed to the sector’s ability to support global enterprises in areas ranging from enterprise software and cloud migration to analytics, cybersecurity and product engineering, arguing that this breadth has positioned India as a preferred partner for digital transformation.
Her remarks come at a time when global spending on software and IT services is rising even as corporations tighten overall technology budgets. Enterprises are prioritising efficiency, automation and resilience, driving demand for outsourced development, managed services and specialised research capabilities. India’s technology firms, she said, are responding by moving up the value chain and aligning offerings with these priorities.
India’s rise in software services leadership was underpinned, Sitharaman said, by a large pool of engineers and domain specialists, many trained in emerging fields such as artificial intelligence, data science and advanced computing. She highlighted the role of the country’s higher education ecosystem and industry-led skilling initiatives in ensuring a steady supply of talent for global clients, while also supporting domestic innovation.
Industry data show that software development and IT-enabled services account for the largest share of India’s technology exports, with clients spread across North America, Europe, Asia-Pacific and the Middle East. Knowledge process outsourcing, once a niche segment, has expanded into areas such as financial analytics, legal services, clinical research support and engineering design. Contract research and development, particularly in automotive, aerospace, semiconductors and life sciences, has also grown as multinational companies locate global capability centres in Indian cities.
Sitharaman noted that the evolution of global capability centres has been a critical factor in this shift. What began as back-office operations have increasingly become hubs for core product development, intellectual property creation and strategic decision-making. Many centres now house multidisciplinary teams working on next-generation technologies, reinforcing India’s reputation as a destination for complex, mission-critical work.
She also linked the sector’s global standing to domestic policy initiatives aimed at strengthening digital infrastructure and innovation. Investments in high-speed connectivity, data centres and digital public platforms have reduced operational friction and enabled technology firms to scale efficiently. The government’s emphasis on ease of doing business, she said, has helped attract sustained foreign investment into technology services and R&D.
At the same time, Sitharaman acknowledged that the sector faces challenges from rapid technological change and intensifying global competition. Automation and generative AI are reshaping service delivery models, requiring firms to continually reskill workforces and redesign processes. She said India’s advantage lies in its ability to adapt quickly, combining technical expertise with process maturity and cost efficiency.
The finance minister also addressed concerns around global economic uncertainty, noting that diversified client exposure and a strong domestic market have helped cushion the technology sector against external shocks. Digital adoption by small and medium enterprises, government departments and startups within India has created additional demand for software and IT-enabled services, complementing export-driven growth.
Experts tracking the sector say the emphasis on knowledge-intensive services and contract R&D reflects a structural shift rather than a cyclical trend. As products become more software-driven, companies are seeking partners capable of end-to-end development, testing and lifecycle management. India’s long experience in large-scale project execution, combined with growing design and research capabilities, has made it competitive in these areas.