The Indian IT services market grew by 7.3 per cent in the first half of 2021, compared to the 5.7 per cent growth in the same period last year, as enterprises continued to invest in digital transformation initiatives, a new report showed on Wednesday.
Overall, the Indian IT and business services market was valued at $6.96 billion and recorded a 6.4 per cent year-over-year (YoY) growth in the January-June period, compared to 5.1 per cent in the first half of 2020, according to the International Data Corporation’s (IDC) worldwide semi-annual services tracker.
“Verticals like government and manufacturing, which delayed IT investments in 2020, hiked up their IT spend in H1 2021, and enterprises in the country continued to increasingly depend on IT service providers for solutions in areas like cloud, security, artificial intelligence, analytics, etc.,” said Harish Krishnakumar, senior market analyst, IT Services, IDC India.
The IT and business services market is projected to reach $19.93 billion by the end of 2025, growing at a CAGR of 8.2 per cent between 2020-2025, the report said.
“H1 2021 turned out to be the year that showcased enterprise resiliency strengthen at a remarkable pace. Most enterprises witnessed a bounce back with business reaching the pre-pandemic situation,” said Shweta Baidya, senior research manager, enterprise software and ICT services, IDC India.
While large enterprises continued to take long strides towards transformation initiatives, the mid-market segment adopted a cautious approach towards technology investments, with a focus on investments that provided quick returns in the form of customer acquisition, talent retention or financial returns, she added.