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Indian IT spend to reach $72 bn in 2011: Gartner

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CIOL Bureau
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MUMBAI, INDIA: India information and communication technology (ICT) spend is forecast to reach $71. 9 billion in 2011, a 10.3 percent increase from 2010 spending of $65.23 billion, according to Gartner, Inc.

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Hardware is the fastest growing segment with a compound annual growth rate (CAGR) growth of 20.4 percent through 2014. IT services is showing the strongest annual revenue growth at 22 percent in 2010 while the telecom segment, that is forecast to account for 73 percent of the Indian ICT market in 2010, is witnessing a slow down and is set to grow at 13.2 percent growth, Gartner said in a study. Double-digit growth across all sub segments of the ICT space will drive the growth this year.

“IT spending in India saw somewhat of a slowdown as a result of the global economic recession through much of 2009. The overriding major theme across companies in India last year was better utilization of existing resources and driving efficiencies of infrastructure,” said Sondergaard.

“While many companies adopted a cautionary approach in 2009, a strong return to growth has been seen in 2010, due in part to pent-up demand following budget slowdown in 2009, the need to replace / add hardware and the massive consumer segment driven growth across many industries,” he added.

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According to Gartner, a large young working population, a rapidly rising middle class and emerging opportunities in the services sector are going to be the key factors in the growth of the consumer market in India.

“Growth within smaller towns and cities will provide the next level of opportunity for IT vendors across categories,” Sondergaard said.

In hardware, much of the growth will be driven by spending within the client computing space, said the study. Increasing rural prosperity, aided by growth in the small office and the small business segment, are the key growth drivers in the PC segment.

“The IT services space in India will be driven by new projects in areas of business applications (CRM, ERP, BI), virtualization and data center consolidation and green IT exploration,” said Partha Iyengar, vice president and distinguished analyst at Gartner and head of research in India.

“Government and defense segments will create sizeable opportunities in large systems integration projects for application services. Managed services around IT infrastructure will open up doors to application services,” he said.

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