India IT spending to reach $71.5B in 2013: Gartner

11 Oct, 2012

IT spending in India is projected to touch $71.5 billion in 2013, a 7.7 per cent increase from the $66.4 billion forecast for 2012, according to IT research and analysis firm Gartner, Inc.

The telecommunications market is the largest IT segment in India, with IT spending being forecast to reach $47.8 billion in 2013, followed by the IT services market with spending of $10.3 billion. The computing hardware market is projected to reach $9.5 billion in 2013 and software spending will be nearly $4 billion.

"India like other emerging markets continues exercising strong momentum despite inflationary pressures and appreciation of local currencies, which are expected in rising economies," said Peter Sondergaard, senior vice president and global head of research at Gartner.

Software segment will record the strongest revenue growth at 15 per cent and IT services will grow at 12 per cent. The telecom segment, which accounts for 67 per cent of the Indian ICT market, is set to register seven per cent revenue growth in 2013.

According to Sondergaard, businesses are increasingly looking to IT to help support the challenges of enhancing customer support, supply chain management, optimizing business processes or helping drive innovation in the business. "These demands are being placed on IT in an environment in which the infrastructure (hardware and software) foundation of IT within many enterprises may not be entirely in place. IT is also in transition from being viewed as a back-office support function to a frontline business-focused function."

Partha Iyengar, head of research – India, Gartner said that the hardware segment will account for 14.1 per cent of all IT spending in India by 2016, driven by positive contributions from the storage and the client computing segment. "Mobile phones will continue to be the fastest growing space within the Indian IT market. During the same time period, this segment will also account for nearly 42 per cent of all telecommunications revenue in India and it will also account for nearly 26 per cent of the overall IT spending."

While IT is the primary driver of business growth, concerns around the economic slowdown are gathering strength and are a matter of concern. In Gartner's latest CEO survey, 85 per cent of CEOs believe they will be negatively impacted by the global economic slowdown.

"We live and work in an age unleashed by a nexus of forces; social, mobile, information and cloud. While there is economic uncertainty there is also enormous opportunity. IT is at the centre of every business, every government agency from the backend and the edge, directly to the customer. These forces are innovative and disruptive just taken on their own, but brought together, they are revolutionising business and society," said Sondergaard.

(Edited by Prem Udayabhanu)