After 3% decline in 2020, India’s IT spending to grow 6.8% to $89 billion

After 3% decline in 2020, India’s IT spending to grow 6.8% to $89 billion

PUNE: India’s IT spending is projected to total $88.8 billion in 2021, an increase of 6.8% from last year, according to the latest forecast by Gartner Inc.

Indian IT spends had declined 2.7% in 2020, with companies prioritising spending on ‘mission-critical’ technology and services in the initial stages of the Covid-19 pandemic.

Gartner forecasts that worldwide IT spending will total $3.9 trillion in 2021, an increase of 6.2% from 2020.

“In 2021, CIOs have to fast track their digital projects to get the necessary attention and funding from the board,” said Naveen Mishra, senior research director at Gartner.

“Digital initiatives directly related with improving customer engagement and supported with a shorter ROI window will be prioritised in the current economic environment. Improving demand scenario across select verticals in India will spur the overall IT spending in 2021.”

According to Gartner, enterprise software will see the biggest increase, growing at 8.8% as remote work environments are expanded and improved. This will be followed by devices, growing at 8% and projected to reach $705.4 billion in IT spending.

“There are a combination of factors pushing the devices market higher,” said John-David Lovelock, research vice-president at Gartner.

“As countries continue remote education through this year, there will be a demand for tablets and laptops for students. Likewise, enterprises are industrialising remote work for employees as quarantine measures keep employees at home and budget stabilisation allows CIOs to reinvest in assets that were sweated in 2020.”

Gartner forecasts global IT spending related to remote work will total $332.9 billion in 2021, an increase of 4.9% from 2020. Through 2024, businesses will be forced to accelerate digital business transformation plans by at least five years to survive in a post-Covid-19 world that involves permanently higher adoption of remote work and digital touchpoints.

“Digital business represents the dominant technology trend in late 2020 and early 2021 with areas such as cloud computing, core business applications, security and customer experience at the forefront. Optimisation initiatives, such as hyper-automation, will continue and the focus of these projects will remain on returning cash and eliminating work from processes, not just tasks,” said Lovelock.

Overall, returning global recovery back to 2019 spending rates will not occur until 2022, although many countries may recover earlier.

“Covid-19 has shifted many industries’ techquilibrium,” said Lovelock. “Greater levels of digitalisation of internal processes, supply chain, customer and partner interactions, and service delivery is coming in 2021, enabling IT to transition from supporting the business to being the business. The biggest change this year will be how IT is financed; not necessarily how much IT is financed.”

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