The India IT & Business Services market grew 5.3 percent during January-June 2020, according to IDC.
IDC forecasts that the IT & Business Services market in India is expected to grow annually by 5.4 percent to reach $13 billion by December 2020.
Of the IT & Business Services market, the IT Services market contributed 77.4 percent in 1H20 and grew by 5.9 percent in 1H20 compared to the 9.3 percent growth in 1H2019.
IT Services market will be picking up momentum from 2021 onwards and is projected to grow at a CAGR of 7.2 percent between 2019-2024, to reach $13.4 billion by the end of 2024. This reduced rate of growth in the IT Services market in India is due to the COVID-19 pandemic.
Application hosting services and infrastructure hosting services continued to be higher growth markets on account of increasing adoption of cloud applications (mainly collaboration applications and videoconferencing) and cloud infrastructure. Owing to increased demand for VPN licenses and requirement for higher network connectivity, network services witnessed higher adoption.
During these difficult times, organizations were investing higher in collaboration applications, VPN licenses, endpoint devices, cybersecurity solutions, cloud, AI, and automation. IT service providers have helped organizations to achieve a higher degree of tech resilience, adaptability, and DX maturity, to become future-ready.
“Most leading IT Service vendors have launched AI based applications to help the government and healthcare sectors to provide citizen services and answer COVID-19 related queries, and for organizations to ensure the safe and secure return of their employees to the workplace,” said Garima Goenka, market analyst, IT Services, IDC India.
Enterprises strongly felt the need for advisory and support services to propel their digital journey amidst the pandemic. As a result, IT service providers witnessed a strong surge in demand for various services such as systems and network management, IT Consulting, hosting application management and hosting infrastructure services, among others.
IT investments across all the major sectors such as BFSI, healthcare, telecom, IT/ITeS, government and manufacturing increased considerably to improve overall experience and maintain business continuity and resiliency, said Shweta Baidya, senior research manager, Enterprise Software and ICT Services, IDC India.