India's software industry will enjoy annual growth of around 50 per cent over the next four years, despite the sluggish national economy, a top industry executive has predicted.

Mr Dewang Mehta, executive director of the National Association of Software Companies (NASSCOM), said the growth would be fuelled by growing diversification, as well as sales of specialist services for Euro currency conversions and combatting the millennium bug.

"The growth will be mainly due to the domestic companies expansion into new areas like research and development," Mr Mehta said in an interview.

India's software industry grew 59 per cent to 2.5 billion dollars in the fiscal year to March 1998, compared to the previous year.

Mr Mehta said Euro currency conversions by banks and financial institutions before the launch of the single European currency on January 1 would also aid growth.