IT spending in India to touch $100 billion in 2022, forecasts Gartner

IT spending in India is expected to touch $101.8 billion in 2022, up 7% from this year (2021), as chief information officers (CIOs) build on renewed interest in technology from the business to gain funding for new IT (information technology) projects, research firm Gartner said on Wednesday. The research firm said that in 2022, all segments of IT spending in India are expected to grow, with software emerging as the highest growing segment.

In the current year, 2021, IT spending across areas like communication services, data centre systems, IT services and software is expected to grow 10.8% to $95.1 billion from $85.8 billion in the preceding year.

Gartner Research vice-president Arup Roy said, ‘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.’

According to 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 composable business and IT architecture where they will be able to better respond to disruptions.

Spending on software is forecast to total $10.5 billion in 2022, up 14.4% from 2021 ($9.1 billion). 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. IT services are expected to log a 9.1% to $19.7 billion in 2022 from $18.1 billion in 2021. 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% from 2021 ($41 billion).

‘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% of the total IT spending next year,’ Roy said. Spending on communication services is expected to rise 2.3% to $24.5 billion in 2022 from $24 billion in 2021, while that on data centre systems is forecast to grow 3.4% to $2.8 billion in 2022 from $2.7 billion in 2021, according to Gartner.