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The Future - Outlook: 1999 - 2000 and beyond

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CIOL Bureau
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The future

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Outlook: 1999-2000

and beyond



The forecast for 1999-2000 and beyond is based on IDC’s outlook for the future as
highlighted below:

 Economy

  • Industrial growth rate will improve. Early indicators for the year clearly point

    in that direction. In the first two months of 1999-2000, there has been an improvement in

    diesel consumption, steel output, cement consumption and railway freight. IDC believes

    that these four indicators are a good measure of the state of the economy.
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  • Exports will also pick up during the year with the global economy expected to recover.

    The worldwide GDP is expected to improve from 2 percent in 1998 to 2.5 percent in 1999.

    •  Political Scenario

    • The political scenario in the country will remain uncertain for a major part of the

      year. The elections due in September-October 1999 will lead to a temporary slowdown.

      However, some stability is expected on the political front thereafter.
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       IT Spending

      • Banks and financial institution will continue along the path of rapid computerisation.

        However, the directive issued by the Central Vigilance Commission will have only a limited

        impact till 2000 and hence proliferation among smaller banks will take some more time.
      • Corporate buying will improve in 1999, due to the expected improvement in industrial

        growth. The year 2000 will see a further spurt in corporate buying.
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      • Spending by Government departments and agencies will begin to pick up from 2000.
      • Home, Small Office and Small Business segments will continue with their spending on IT

        products like PCs and peripherals. Although these segments will continue to grow at rates

        above than the overall average, IDC believes that the growth rates might taper off a bit

        from 1999.
        • Due to low current penetration, the Internet subscriber base will show dramatic growths

          in the short term. However, access charges are unlikely to change dramatically, thus

          curbing the growth of Internet subscribers to an extent.
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        IT Market Forecast,1999-2000 and 2000-01 (Rs. Crore)
        Segment 1999-2000 Annual Growth (%) 2000-01 Annual Growth (%)
        Personal Computers 4901.2 22.2% 6246.3 27.4%
        Servers (Other than PC

        Servers)        		 394.0 -6.4% 414.2 5.1%
        Traditional Workstations 104.5 -4.4% 96.8 -7.3%
        Peripherals 1317.8 7.1% 1513.0 14.8%
        Datacom Products 1255.8 37.6% 1706.3 35.9%
        Hardware 7973.3 19.3% 9976.6 25.1%
        Packaged Software 1554.7 16.5% 1824.5 17.4%
        Services 4012.5 20.7% 4863.3 21.2%
        Others* 1685.8 22.1% 2076.9 23.2%
        Total IT Market 15226.3 19.7% 18741.2 23.1%
        * includes consumables and

        individual training

        Source: IDC (India) Limited, 1999



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