Mumbai: India ''s IT software and services sector is expected to bring revenues of $50 billion this fiscal as against $39.6 billion in 2006-07, industry association Nasscom said in its annual survey.

The growth rate, however, is exepected to slow down to 24-27 per cent compared to 30.7 per cent achieved in FY07, Nasscom warned.

The Indian IT-ITeS industry recorded an overall 30.7 per cent growth against the projected 27 per cent in 2006-07. Revenues were up from $30.3 billion in 2005-06.

The software and services exports segment grew by 33 per cent to $31.4 billion in 2006-07, up from $23.6 billion in 2005-06. Revenues from the domestic segment grew by 23 per cent to $8.2 billion from $6.7 billion in 2005-06.

While India continues to be the most preferred destination for global IT sourcing due to its talent pool, top-quality management and security and quality focus, there are certain short to medium term challenges that need to be addressed swiftly, Nasscom president Kiran Karnik said.

"These include rupee appreciation, suitability of available talent, infrastructure development and sustenance of a positive regulatory environment," Karnik said, adding, these require timely, consistent and continued effort from all stakeholders including industry, government and academia.

"We are confident that the forecast (exports plus domestic market) of $50 billion in 2007-08 will be achieved, as will the target of $60 billion exports by 2009-10," Karnik said (See: IT, ITeS heads for $50-billion mark)

The Nasscom chief, meanwhile, rejected allegations made by US senators of abuse of visas by some Indian companies.

"We have not seen anything beyond allegations," Karnik said responding to questions at a news conference. "There is no real misuse." Karnik maintained there was no scope for misuse by big IT companies as they were transparent in their functioning.

But he maintained there could be some small companies – he stressed not Indian firms – misusing them.

Nasscom chairman Lakshmi Narayanan said authorities in the US were only collecting data in this regard. He added there was no direct accusation or allegation of misuse against Indian IT companies.

Two US snators, Richard Durbin and Chuck Grassley, last month claimed that top 20 H1-B users, which included Indian IT companies such as TCS, Satyam, Wipro and Infosys, "abused" L-Visa programme.

Karnik also said the export-driven IT industry was concerned over "rapid appreciation" of the rupee against the US dollar. "The appreciation was too much, too fast," he said.

Karnik pointed out the rupee had appreciated by as much as nine per cent in the last three months. He noted that China was holding its currency steady and within a "small band".