India IT Spending to touch $124.6 billion in 2024

India IT spending is projected to total $124.6 billion in 2024, an increase of 10.7% from 2023, as per Gartner, whereas GenAI will account for a small portion of IT spending through 2024. While investments in artificial intelligence (AI) and generative AI (GenAI) will contribute to IT spending growth in India, their impacts on IT spending levels will not be evident until 2025.

Naveen Mishra, VP, Team Manager at Gartner said,“Indian organizations are expected to make investments in AI and automation during this time, as a strategic effort to improve operational efficiency and address the ongoing shortage of IT talent. As Indian organizations accelerate the adoption of digital technologies such as AI, machine learning, secure access service edge (SASE), there will be a greater implementation of cloud services, resulting in growth for both software and IT services. The lack of internal skills within Indian businesses will also contribute to the growth of IT services spending in 2024.”

The double-digit growth in 2024 can be attributed to Indian consumers’ willingness to pay a higher price for better experience when upgrading to new smartphones.

Cloud computing is one of the key drivers of IT spending growth in India. Businesses are increasingly moving their workloads to the cloud to take advantage of its scalability, agility, and cost-effectiveness.

Digital transformation initiatives are also driving IT spending growth. Businesses are investing in new technologies to improve their customer experience, operational efficiency, and product development processes.

Cybersecurity is another important area of IT spending growth. Businesses are investing in cybersecurity solutions to protect their data and systems from cyberattacks.

Here is a breakdown of IT spending in India in 2024 by segment:

Software: $32.1 billion

IT services: $31.3 billion

Communications services: $18.5 billion

Devices: $28.5 billion

Data center systems: $14.2 billion

Additionally, CIOs and IT leaders must be able to navigate decisions about AI within their organizations by having lighthouse principles — a vision for AI that lights the way and says what kind of human-machine relationships they will and will not accept.

The IT services segment is expected to be the fastest-growing segment in 2024, with a growth rate of 11.2%. This is due to the increasing demand for IT services to support digital transformation initiatives.

The IT industry in India is expected to continue to grow in the coming years. The Indian government is investing heavily in digital infrastructure, and businesses are increasingly adopting new technologies. This growth is expected to create new jobs and opportunities in the IT sector.

Dr. Deepak Kumar Sahu, President & CEO, VARINDIA