With the economy on a growth trajectory, Indian ICT spending is projected to soar beyond $100 billion in 2021.
A sharp revival in economic activities and growing consumer demand during the pandemic era will lead to Indian enterprises spending $91 billion on information and communication technologies (ICT) in 2021, marking a 10 percent increase than last year.
With the pandemic fueling a rapid growth of ICT spending and enterprises changing focus and business models to deliver digital-first experiences, spending by Indian businesses could soar beyond $100 billion in the next three years, according a report released by the International Data Corporation (IDC).
According to Ashutosh Bisht, senior research manager at IDC, Indian government initiatives like production-linked incentives (PLI) and Make in India have made technology-led investments towards digital transformation inevitable. “Providing an alternative to China as the global manufacturing hub will also step up India’s position in the global arena," he said.
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IDC said the revival of economic activities in India and growing consumer demand have played a key role in the growth of ICT spending. Enterprises have changed their business models to deliver digital first experiences. “Major industries have reached operations at optimal levels as demand picked up owing to an improved supply into 2021," the company said.
The report – covering 120 technologies, 15 hardware markets, 83 software functions and 12 information technology (IT) services – comes as a forecast by Gartner projected similar numbers. It said that IT spending in India is projected to cross $93 billion in 2021, an increase of 7.3 per cent from 2020.
Worldwide, the survey found that IT spending is projected to total $4.1 trillion in 2021, an increase of 8.4 per cent from 2020. “IT no longer just supports corporate operations as it traditionally has, but is fully participating in business value delivery," John-David Lovelock, Distinguished Research Vice President at Gartner, said in a statement.
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"Not only does this shift IT from a back-office role to the front of business, but it also changes the source of funding from an overhead expense that is maintained, monitored and sometimes cut, to the thing that drives revenue,” he said.
The highest growth will come from devices (14 per cent) and enterprise software (10.8 per cent) as organisations shift their focus to providing a more comfortable, innovative and productive environment for their workforce, Gartner said.
Cloud is expected to drive the majority of the expected software growth in India during 2021, it added. "The Indian economy is observing a slow but steady growth trajectory this year," said Naveen Mishra, Senior Research Director at Gartner. "Additionally, the government relaxation of foreign investment in certain sectors such as insurance, infrastructure, telecommunications will provide additional funds for business and IT leaders to accelerate their digital transformation journey,” he added.