Indian IT spending to touch $160 billion, grow by 11.2% due to AI demand: Gartner

Gartner has also predicted that by next year more than 50% of GenAI-powered application offerings will have an associated price premium

IT spending in India is projected to grow to $160 billion in 2025, a 11.2% increase from this year, according to Gartner. At the Gartner IT Symposium, Naveen Mishra, VP analyst at the research firm pointed out that cloud, applications and consulting would push growth in the country. 

Due to expansion in both application and infrastructure software markets, the software spending in India is also projected to record the highest annual growth rate, increasing 17% in 2025.

Meanwhile, GenAI will play a big role in industry use cases while also raising expectations of productivity among Indian enterprises for 2025 and the years ahead. 

Gartner has also predicted that by next year more than 50% of GenAI-powered application offerings will have an associated price premium. Pricing options will keep changing depending on how much customers are willing to pay. 

“The price premium of GenAI-enabled offerings across customer relationship management (CRM), email and authoring, and analytic platforms will drive software spending, resulting in growth of this segment,” said Mishra.

He also noted that from next year onwards budgets would be separately allocated for GenAI beyond the initial proof-of-concept projects. “While spending on GenAI will increase, CIOs’ expectations for its capabilities will diminish. Additionally, Indian CIOs are expected to significantly boost spending on technologies such as cybersecurity, business intelligence, and data analytics in 2025 compared to 2024,” he added. 

Data centers also have a growing footprint in the country with a projected spending of $4.7 billion in 2025. “Data center providers, including hyperscalers, are expanding their footprint in India to meet enterprise demands for increased data storage and computing capacity, while adhering to regulatory requirements, further driving the growth of this segment,” said Misra. 

Published - November 13, 2024 01:04 pm IST