End-user spending on IT services in India to reach US$18B in 2021.
The Indian IT services market has proven its durability through the last 15 months of the pandemic, according to Gartner.
“The surge in remote working, need for business continuity planning and increased focus towards digitalization has increased the demand for IT services,” said Arup Roy, research vice president at Gartner. “In 2020, spending on IT services slowed, but did not decline. While some digitalization projects were stalled due to IT budget contractions and economic uncertainties in 2020, 2021 is experiencing renewed interest in rapid digitalisation from end-user organisations.”
The consulting segment will be the largest in terms of end-user spending in 2021. It is forecast to total US$4.6 billion this year, up from US$4.1 billion in 2020.
Hardware support will be the only segment where spending will decline in 2021. It will decline 2.8 per cent as end-user organizations reduce their spending on client device support and data centre support systems.
“Organisations in India are moving towards a cloud-only or a cloud-first model, which is why spending on infrastructure as a service (IaaS) will experience strong growth in 2021,” said Roy. “Indian enterprises are demanding more agility, rapid innovation and a swift move towards becoming a composable enterprise resulting in an increased adoption of cloud through 2021.”
In 2021, end user spending on IaaS will total US$1.6 billion, growing 57 per cent as compared to 2020. This will be the highest registered growth rate within all segments of IT services spending in India. While IaaS is expected to contribute to 9 per cent of the total spending on IT services in the country in 2021, by 2025, spending on IaaS is forecast to make up 22.7 per cent of the total spending on IT services in India.