Software and IT services: Value chain, from upstream to the customer
Operating systems, business applications and outsourced IT services, a core Indian export
Value chain, from upstream to the customer
Criticality to the chain: 5 · Chokepoint 4 · Critical 3 · Important 2 · Supporting 1 · Commodity service Stage 1 Compute and cloud platformsRent computing, storage, databases and AI accelerators on demand from global data-centre fleets to software firms, enterprises and governments.1,3
Why critical: Three US firms take 63% of cloud infrastructure revenue, and moving large workloads between clouds takes many months and real cost. Technologies Virtualisation and containers (Kubernetes) Custom AI accelerators and GPU clusters Managed databases Global content and network backbones Depends on Commodities Si SiliconCu CopperH₂O Water Chemicals MEG Monoethylene glycolHFC Fluorochemicals and refrigerants Energy DC Data centresDist Distribution grids, mini-grids and interconnectorsHP Heat pumps, air conditioning and refrigeration Industries Data centres and cloudComputers and electronicsTelecommunicationsExamples: Amazon Web Services, Microsoft Azure, Google Cloud, Yotta Data Services · Top three ≈ 63% of cloud infrastructure revenue, Q2 2026Sell or license the operating systems, databases, middleware and developer tools on which applications are built.1
Why critical: A handful of vendors control desktop, mobile and enterprise database platforms, and rewriting applications for a new platform takes years. Technologies Operating systems (Windows, Linux, Android) Relational and cloud databases Integrated development environments Code hosting and CI/CD Depends on Energy DC Data centres Industries Data centres and cloudExamples: Microsoft, Oracle, Red Hat (IBM), GitHubHost and steward freely licensed code (Linux, Kubernetes, Python, PostgreSQL) that most commercial software reuses, funded by member companies.1
Why important: Free to use and widely mirrored, but much critical code depends on few maintainers, so a flaw or abandoned project causes costly scrambles. Technologies Linux kernel Programming languages and package registries Open-source databases Software bill of materials (SBOM) tooling Depends on Energy DC Data centres Industries Data centres and cloudExamples: Linux Foundation, Apache Software Foundation, Python Software FoundationSell identity, endpoint, network and cloud security software and managed detection services that protect other software and data.1
Why important: Many vendors compete, but a security agent runs deep in every machine, and a faulty update or switch can disrupt whole fleets. Technologies Endpoint detection and response Identity and access management Firewalls and zero-trust networking Security operations centres Depends on Energy DC Data centres Industries Data centres and cloudComputers and electronicsExamples: Palo Alto Networks, CrowdStrike, Microsoft, Quick HealBuild and sell subscription software for finance, HR, sales, supply chain and collaboration to businesses of every size.1,2
Why important: Many vendors compete, but ERP and CRM systems hold core records and replacing them takes a year or more. Technologies Multi-tenant SaaS architecture ERP and CRM suites Low-code platforms Embedded generative AI assistants Depends on Energy DC Data centres Industries Data centres and cloudExamples: SAP, Salesforce, Zoho, FreshworksMake apps, games and industry-specific packages (banking, healthcare, design) sold through app stores, licences or subscriptions.1,4
Why supporting: Highly competitive and most products have close substitutes, though mobile distribution runs through two app stores: Android and iOS carried 99.97% of mobile web traffic in October 2026 (StatCounter). Technologies Mobile app frameworks App-store distribution Payments SDKs Analytics and A/B testing Depends on Energy DC Data centres Industries Data centres and cloudExamples: Intuit, Adobe, Tally Solutions, Nazara TechnologiesDesign, build, integrate and run software and infrastructure for enterprises under multi-year contracts, often from offshore delivery centres.2
Why important: Several large firms can do the work, but transitioning a big outsourced estate takes six to twelve months. Technologies Agile and DevOps delivery Cloud migration and managed services Application maintenance AI-assisted coding Depends on Energy Bld Energy in buildingsICE Internal combustion engines and gensets Industries Data centres and cloudReal estateExamples: Tata Consultancy Services, Infosys, Accenture, HCLTech · ≈ 47% of India's FY26 tech revenue (calculated from Nasscom estimates)Supply embedded software, product engineering and back-office processing (finance, claims, customer support) to manufacturers and service firms.2
Why supporting: Competitive supply in India and elsewhere; work can move between vendors within weeks to months. Technologies Embedded and automotive software Digital twins and simulation Robotic process automation Contact-centre platforms Depends on Energy Bld Energy in buildings Industries Data centres and cloudTelecommunicationsExamples: L&T Technology Services, Tata Elxsi, Genpact, ConcentrixIn-house technology and operations centres that multinationals run in India and elsewhere to build and run their own software.2
Why supporting: A parent can shift work between its own hubs and vendors; Nasscom names GCCs as a key growth driver rather than a chokepoint. Technologies Product engineering Data and AI platforms Cybersecurity operations Shared services Depends on Energy Bld Energy in buildings Industries Real estateData centres and cloudExamples: Walmart Global Tech India, JPMorgan Chase India, Goldman Sachs BengaluruResell software licences, cloud credits and hardware to businesses and handle procurement, billing and first-line support.1
Why commodity service: Many resellers sell the same products; buyers can switch at the next renewal. Technologies Cloud marketplaces Licence management Subscription billing Pre-sales configuration Depends on Energy Bld Energy in buildings Industries Computers and electronicsTransport and logisticsExamples: Redington, Ingram Micro, CDW, CrayonRecruit, train and place software engineers on contract or permanent roles for IT firms and enterprises.2
Why supporting: Competitive market; India's workforce of about 59.5 lakh tech employees gives a deep talent pool. Technologies Applicant tracking systems Online coding assessments Bootcamps and certification programmes Depends on Energy Bld Energy in buildings Industries Education and researchExamples: TeamLease Digital, Quess IT Staffing, Randstad, NIIT