IT spending in India forecasted to reach $101.8 billion in 2022: Gartner

IT spending in India is forecast to total $101.8 billion in 2022, an increase of 7 per cent from 2021, according to the latest forecast by Gartner, Inc.

“The digital transformation trajectory that began as a pandemic response is here to stay for the next few years. India has experienced one of the fastest recoveries despite being one of the worst hit regions in the second wave of the pandemic in early 2021. In 2022, CIOs in India will build on renewed interest in technology from the business to gain funding for new IT projects,” said Arup Roy, research vice president at Gartner.

Indian CIOs are likely to increase their spending towards projects that drive innovation and modernising legacy systems. Hiring a workforce that can deliver on these needs will also be a key priority. Next year, Indian CIOs are prioritising a move away from rigid and monolithic ways of doing business to a more compostable business and IT architecture where they will be able to better respond to disruptions.

In 2022, all segments of IT spending in India are expected to grow, with software emerging as the highest growing segment. Spending on software is forecast to total $10.5 billion in 2022, up 14.4 per cent from 2021 (see Table 1). While experiencing a slower growth rate than 2021, spending on software in 2022 is forecast to be nearly double of what it was pre-pandemic, Gartner added.

Table 1. India IT Spending Forecast (Millions of U.S. Dollars)

 

 

2020 Spending

 

2020 Growth (%)  

 

2021 Spending

 

2021 Growth (%)  

 

2022 Spending

 

2022 Growth (%)  

 

Communication Services

 

22,999

 

11

 

24,000

 

4.4

 

24,551

 

2.3

 

Data Center Systems

 

2,614

 

-11.3

 

2,764

 

5.7

 

2,859

 

3.4

 

Devices

 

36,014

 

-5.8

 

41,040

 

14

 

44,132

 

7.5

 

IT Services

 

16,352

 

3

 

18,119

 

10.8

 

19,768

 

9.1

 

Software

 

7,852

 

17

 

9,188

 

17

 

10,507

 

14.4

 

Overall IT

 

85,831

 

1.5

 

95,110

 

10.8

 

101,817

 

7

 

As hybrid work adoption increases in the country, there will be an uptick in spending on devices in 2022, reaching $44 billion, an increase of 7.5 per cent from 2021. “The growth in devices is a combination of two components – hybrid work and pent-up demand from 2020 for device upgrades. Spending on devices will make up 43 per cent of total IT spending next year,” said Roy. 

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

Roy also explained that that the data centre systems have increased in the last few years.

The new projects of enterprises were not executed in the previous year due to the COVID19 pandemic which led to an increase in demand. Enterprise shifting to cloud is an important and significant trend, which will further increase and will also cause the market to bifurcate.

Till the year 2019 the market of PC and tablet was declining but during the COVID19 pandemic, the demands increased due to work from home and students studying from home, there was an uptake in the market which could possibly decline in the few years.

In Gartner’s 2022 Board of Directors Survey, 57 per cent of board directors reported that they increased or expected to increase their risk appetite through 2022.

“If we look at CIOS and the enterprise enablement that has been executed in the last two years has been unprecedented. In the last two years because of the efforts in terms of sustaining and continuity of the businesses have been championed by the CIOs and CTOs,” added Roy.

Anuradha Nagar

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