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MUMBAI, India., November 23, 2020

Gartner Forecasts IT Spending in India to Grow 6% in 2021

Analysts Discuss the Outlook for the Indian IT Market During Gartner IT Symposium/Xpo 2020 India, November 23-25

IT spending in India is projected to total $81.9 billion in 2021, an increase of 6% from 2020, according to the latest forecast by Gartner, Inc. IT spending in 2020 is expected to total $79.3 billion, down 8.4% from 2019.

Analysts discussed the outlook for the Indian IT market during Gartner IT Symposium/Xpo India, which is taking place virtually through Wednesday.

“The COVID-19 pandemic stalled many digital transformation projects for Indian enterprises, mainly because of the market uncertainties and reduced cash flows,” said Arup Roy, research vice president at Gartner. “Organizations that were digitally sound in a pre-pandemic world could contain the impact on their business. The pandemic situation was a wake-up call for many organizations to relook and revive their IT strategies and increase their spending on IT in 2021.”

In 2020, the devices and data center systems segments experienced the steepest declines, as spending dropped 26% and 1.2%, respectively (see Table 1). Contrary to other markets where spending declined across all segments, CIOs in India continued to spend on enterprise software, IT services and communication services in 2020.These segments are expected to grow 7%, 3.7% and 4.9%, respectively.

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

 

2019 Spending

2019 Growth (%)  

2020 Spending

2020 Growth (%)  

2021 Spending

2021 Growth (%)  

Data Center Systems

3,738

4.8

3,475

-1.2

3,670

8.3

Enterprise Software

6,647

17.1

6,693

7.0

7,415

13.6

Devices

38,279

15.5

26,460

-26.5

26,780

3.8

IT Services

15,410

12.6

15,043

3.7

15,838

8.0

Communications Services

27,943

1.0

27,592

4.9

28,193

4.8

Overall IT

92,017

9.9

79,263

-8.4

81,896

6.0

Source: Gartner (November 2020)

In 2021, IT spending growth will return as CIOs start positioning IT as not just a growth enabler, but a ‘survival necessary’ strategy. While all segments will experience an increase in spending, the enterprise software segment will achieve the highest growth of 13.6%, followed by data center systems at 8.3%.

“The ‘Digital India’ mission will turn a new leaf in 2021 as enterprises across all sectors start spending more on IT. The pandemic provided an opportunity for Indian CIOs to test long-pending projects such as remote working, which delivered on-promise for many enterprises and helped them stay afloat in the most testing times,” said Mr. Roy. “The success of these digital innovations has brought back the focus on investments in IT.”

In 2021, the focus of IT spending will be in becoming a true digital business. CIOs in India will direct their IT spending budgets towards accelerating digitization efforts. Spending is expected to increase on technologies including advanced analytical solutions, access management, encryption software, desktop as a service, cloud, and hyperautomation enabling systems. IT solutions such as robotic process automation (RPA), artificial intelligence (AI), machine learning (ML), and digital commerce will also experience an increase in spending.

More detailed analysis on the outlook for global IT spending is available in the Gartner webinar 'IT Spending Forecast, 3Q20: Technology Trends Accelerated by COVID."

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.

The Gartner quarterly IT spending forecast delivers a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges. The most recent IT spending forecast research is available to Gartner clients in “Gartner Market Databook, 3Q20 Update.” This quarterly IT spending forecast page includes links to the latest IT spending reports, webinars, blog posts and press releases.

About Gartner IT Symposium/Xpo

Gartner IT Symposium/Xpo 2020 is the world's most important gathering for CIOs and other IT executives. IT executives rely on these conferences to gain insight into how their organizations can use IT to overcome business challenges and improve operational efficiency. Follow news coming from Gartner IT Symposium/Xpo on Smarter With Gartner and on Twitter using #GartnerSYM.

About Gartner

Gartner, Inc. (NYSE: IT) delivers actionable, objective insight to executives and their teams. Our expert guidance and tools enable faster, smarter decisions and stronger performance on an organization’s most critical priorities. To learn more, visit gartner.com.

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