ICT spending across Asia Pacific excluding Japan and China (APEJC) is entering a new phase of rapid expansion, with the International Data Corporation forecasting total investments to reach $647 billion in 2026 and exceed $758 billion by 2029. The market is expected to grow 5.4 percent in 2026, outpacing global averages as enterprises shift decisively from experimentation to large-scale deployment of advanced technologies.
The surge in the ICT spending across Asia Pacific reflects a shift in enterprise priorities. Organizations are no longer investing in ICT purely for growth, but to remain competitive in the emerging “Agentic AI” era, where failure to modernize data and infrastructure could lead to rapid obsolescence.
Software will account for 24 percent of total spending in 2026, with focus moving beyond cloud adoption toward data sovereignty and cybersecurity resilience. Rising geopolitical tensions and cyber threats are pushing enterprises to prioritize security software and enterprise resource management platforms as core infrastructure to support AI-driven operations.
Services are becoming equally critical, contributing more than 23 percent of ICT budgets in the Asia Pacific region. Demand is being driven by a widening execution gap, as nearly 60 percent of enterprises require external expertise to assess whether their legacy systems can support AI at scale. The expansion of Global Capability Centers in India and Southeast Asia is further accelerating spending on IT outsourcing and managed services, helping companies address talent shortages and deploy complex AI systems.
Spending on hardware, while growing at 3.6 percent, remains the largest segment with over 52 percent share. Growth is fueled by supply chain diversification strategies, particularly the “China Plus One” shift, which is increasing demand for AI-focused infrastructure, non-x86 servers, and edge computing systems across emerging manufacturing hubs such as India, Vietnam, and Thailand.
Key industries driving ICT investments include banking, software and information services, and central government, which together will account for more than $104 billion in spending in 2026. These sectors are rapidly advancing from basic automation toward autonomous decision-making systems powered by AI.
Regionally, India continues to emerge as the primary growth engine, supported by its Digital Public Infrastructure and push toward sovereign AI capabilities. ASEAN countries are strengthening connectivity and data compliance frameworks to attract global technology investments, while Australia and New Zealand are focusing on integrating AI into healthcare and professional services to address demographic and cost challenges.
With a projected CAGR exceeding 7.4 percent between 2026 and 2029, APEJC’s ICT market is set to play a pivotal role in shaping the global digital economy, driven by the urgent need for scalable AI, resilient infrastructure, and data-centric transformation.
RAJANI BABURAJAN
