India will spend ₹4,491.9 bn on Tech Goods and Services in 2024: Report Several high-tech domains have emerged as the golden future of the Indian tech industry including Generative AI, cloud computing, spatial computing, the industrial metaverse, and others
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The Indian tech segment is making rapid progress. It has already achieved a very positive response in digitizing various sectors including banking, healthcare manufacturing, retail, automotive, governance, and education—driven by strong initiatives by Central and State governments. Several high-tech domains have emerged as the golden future of the Indian tech industry including Generative AI, cloud computing, spatial computing, the industrial metaverse, and others.
According to Forrester's latest report "Asia Pacific Tech Market Forecast, 2023 To 2027," India's tech spending will grow by 10.8 per cent in 2024 to 4.5 trillion—the highest in the Asia Pacific region.
"India's domestic tech economy continues to enjoy strong growth due to an all-round digitization push from the central and state governments," the report reads.
Rise in Spending:
According to the report, the Indian business and government will spend 4,491.9 billion on tech goods and services in 2024. The main sectors that will be seeing huge spending in India are Software (1,007.8 bn), information technology (IT) services (449.1 bn), communications equipment (1,170.4 bn), and computers (1,038.5 bn).
Additionally, the Software purchase in India will see a good jump in its share from 26.4 per cent in 2024 to 30 per cent in the total tech spending in 2027—outpacing the other IT sectors because of the high market demand for artificial intelligence and AI-augmented enterprise software and services.
Growth and Challenges:
Additionally, India is rapidly enhancing its capabilities in mobile device, semiconductor, and electric vehicle (EV) manufacturing, aiming to position itself as a strong alternative to China. However, despite the major initiatives, India faces high youth unemployment and huge mounting pressure on IT and IT-enabled services (ITES) sectors.
In 2023, Indian IT services experienced slower growth because of the low global demand. However, investments in cloud and AI are expected to boost demand in the forecasted period. Additionally, in the last seven years, the venture capital (VC) funding ecosystem also declined, but it has managed to provide millions of jobs directly since 2017.
India's Performance in the Asia Pacific Region:
Economic digitalization was the major game changer in 2023. Nevertheless, the APAC region has been seeing the emergence of AI technologies including generative AI.
As per the data presented in the report, Indian tech performance will be better than other countries in the region, also it will be a fertile ground for various emerging technologies followed by Vietnam 10.4 per cent, Indonesia 10.3 per cent, the Philippines 8.7 per cent, and Thailand 7.9 per cent, Singapore 5.6 per cent and Australia 4 per cent. Nevertheless, China's tech spending will be 7.2 per cent due to its post-covid recovery.
Digital consumption by large Millennial and Gen Z populations with the government's favourable policies and investments from big tech giants will further accelerate digital growth in the region.
