New Delhi: The Indian IT industry is estimated to touch $38 billion in 2006-07, a growth of 25 per cent, according to National Association of Software and Service Companies (Nasscom) forecasts.

Nasscom has based its projections on the strong growth within the industry and the overall increase in offshore outsourcing by global majors, an increase in the scope and scale of the offshoring engagements and a focus on traditional services.

According to Nasscom IT-ITeS exports would grow by 27-30 per cent in 2006-07, with revenues likely to be between $29 billion and $31 billion, with the growth resulting from a number of factors like growing positive acceptance of outsourcing by overseas outsourcers, cross-border M&As and stable pricing.

The domestic market is also expected to grow at 20 per cent, based on the rollout of e-governance initiatives. Nasscom also suggests that automation of key sectors such as retail, healthcare, transportation and manufacturing, would also contribute to the growth.

In addition developments like the emergence of a more efficient global delivery model, and larger IT outsourcing to Indian service providers would help the sectors growth.