India’s Software Exports to US Cross $119 Billion in FY26 as American Share Hits 54.1%
India’s software export story has taken an interesting turn. While global technology spending remains closely watched by investors, the US strengthened its position as the biggest market for India’s software services in FY26, accounting for more than half of total exports.
According to Reserve Bank of India data released on September 18, US-bound software exports rose 11% to $119.7 billion, lifting the US share to 54.1% from 52.9% in FY25.
The numbers could have implications for Indian IT companies and their investors, particularly as the sector continues to navigate US immigration and policy changes.
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US demand takes a bigger share of India’s software exports
India’s total software services exports, excluding sales through overseas affiliates, increased 8.2% to $221.4 billion in FY26.
The US therefore grew faster than India’s overall software export market during the year.
The UK remained the second-largest destination, although its share edged down to 15.4% from 15.5%.
The latest US share of 54.1% is also notable because it matches the level recorded in FY24, before slipping in FY25.
Sales through overseas affiliates of Indian companies added another $17.9 billion to the overall figure.
IT services remain the biggest export engine
IT services continued to dominate India’s software export basket, contributing around $147 billion in FY26.
Business process outsourcing services generated about $56 billion, while software product development exports stood at approximately $6.4 billion.
The RBI survey covers computer services and IT-enabled services, including BPO activities.
The survey received responses from 2,363 companies out of 7,569 exporters contacted, with respondents accounting for about 89% of the RBI’s estimated software services exports.
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On-site earnings fall even as total exports rise
One of the more closely watched details was the decline in on-site earnings.
Revenue from software services delivered on-site fell to $18.4 billion in FY26 from $19 billion a year earlier.
On-site services involve Indian technology employees working at overseas client locations, while off-site services are delivered remotely, including from development centres in India.
The trend is important for investors because it highlights the continuing shift toward remote and offshore delivery models.
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Key details of the FY26 software-export data
1. The US bought $119.7 billion of Indian software services
The United States remained India’s largest overseas market for software services in FY26. Exports to the US increased 11% to $119.7 billion, taking the US share of India’s software-services exports to 54.1%.
That means more than half of India’s software-services exports were directed to the US during the year. The share increased from 52.9% in FY25.
However, 54.1% is not a new record. The US had the same 54.1% share in FY24 before it declined to 52.9% in FY25.
2. India’s total software exports reached $221.4 billion
India’s software-services exports, excluding sales generated through overseas affiliates of Indian companies, increased 8.2% to $221.4 billion in FY26.
The US therefore grew faster than India’s overall software-export market:
| Indicator | FY26 |
|---|---|
| India’s software-services exports | $221.4 billion |
| Growth in total exports | 8.2% |
| US-bound exports | $119.7 billion |
| Growth in US exports | 11% |
| US share | 54.1% |
| Overseas affiliates’ sales | $17.9 billion |
The RBI survey separately estimated another $17.9 billion in sales through overseas affiliates of Indian companies.
3. The UK remained the second-largest destination
The United Kingdom remained India’s second-largest software-export destination.
However, its share edged down slightly to 15.4% from 15.5% in FY25. This highlights how heavily India’s software-export industry remains concentrated in the US market.
4. IT services generated the largest share
Within India’s software-services exports, IT services remained the dominant segment, accounting for approximately $147 billion.
Other major categories included:
- IT services: about $147 billion
- BPO services: about $56 billion
- Software product development: about $6.4 billion
The RBI’s definition covers computer services and IT-enabled services, including business-process outsourcing.
5. On-site software-service earnings declined
One of the more important details is that on-site earnings declined despite overall export growth.
On-site software-service earnings fell to $18.4 billion in FY26, compared with $19 billion in FY25.
On-site services generally involve Indian technology professionals delivering services at a client’s overseas location. In contrast, off-site services can be delivered remotely from development and delivery centres, including those in India.
Stocks to watch
| IT stock | Why investors should track it |
|---|---|
| TCS | One of India’s largest IT exporters, with $30 billion FY26 revenue and $40.7 billion in FY26 TCV, making its exposure to global enterprise technology spending relevant to the broader software-export trend. |
| Infosys | North America contributed 56.1% of FY26 revenue, making US demand an important factor to monitor as India’s software exports to the US expand. |
| Wipro | Its substantial US business exposure makes the company relevant when assessing whether stronger US demand for Indian technology services translates into sustained company-level growth. |
| HCLTech | A major global technology-services provider with exposure to US enterprise spending, while its FY26 performance also included $9.3 billion in new-deal TCV and growing Advanced AI revenue. |
| Tech Mahindra | Its global enterprise technology exposure makes it relevant to the US software-services trend; FY26 revenue was $6.385 billion, with new-deal TCV of $3.794 billion. |
Here’s what happened today and why traders reacted
For Indian IT stocks, the RBI data provides evidence that US demand remained an important growth driver in FY26.
Companies with significant US exposure could benefit from sustained technology spending, but investors will also be watching margins, deal wins, currency movements and hiring trends.
The US market’s growing share also means Indian IT companies remain closely exposed to changes in American policy.
On September 18, US President Donald Trump extended by one year an executive order proposing a $100,000 fee for certain new H-1B visa applications. The measure faces ongoing legal challenges.
However, the RBI data does not establish that visa policy caused the decline in on-site earnings.
The same caution applies to US-India tariff tensions. The RBI survey covers services, while the major tariff measures discussed during the period primarily concerned merchandise trade.
What could the software export data mean for investors?
The immediate takeaway for investors is the continued importance of the US market for Indian IT companies.
The combination of 11% US-bound export growth and 8.2% overall software export growth suggests that US demand remained a key contributor to India’s technology services expansion.
Going ahead, traders may track US technology spending, new deal announcements, H-1B policy developments, offshore revenue growth, employee costs and the rupee-dollar movement.
For investors holding Indian IT stocks, the bigger question is whether strong US demand can continue translating into revenue growth and sustainable margins in the coming quarters.
