India’s IT exports: Deliver the code, chase the cash

India’s information technology sector has long been a major source of foreign exchange, and recent data show that export revenues are growing at a steady pace. Large multinational service providers dominate the headline numbers, but a growing number of small and medium sized enterprises are also securing contracts with clients in Europe, North America and the Middle East. These firms benefit from lower overhead costs and the ability to offer niche solutions, which makes them attractive partners for foreign buyers seeking flexibility and innovation.

Despite the positive trend in order books, many smaller companies report difficulties in converting sales into cash. Payment terms imposed by overseas clients often extend to 90 days or more, and the lack of robust credit insurance mechanisms leaves Indian exporters vulnerable to defaults. In several cases, firms have had to resort to costly legal action in foreign jurisdictions to recover dues, a process that drains resources and hampers their ability to invest in new projects. The problem is amplified by limited access to working‑capital financing that is tied to export receivables.

Industry bodies and the government are responding with measures aimed at improving cash flow for exporters. Proposals include the creation of a dedicated export credit guarantee scheme, faster processing of export‑linked loans, and the use of digital platforms to track invoice status in real time. By addressing the financing gap, policymakers hope to ensure that the growth in export orders translates into sustainable revenue for companies of all sizes, thereby strengthening India’s position in the global technology market.