Indian Enterprise IT Spending Will Grow 10.3% In 2012

Indian enterprise IT spending across all industry markets is forecast to surpass $39 billion in 2012, a 10.3 percent increase from 2011 spending of $36 billion, according to Gartner, Inc. The growth of IT in India is expected to continue, with an annual increase to exceed this level through to 2015.

“The pace of economic growth in India, with a mild, by global standards, dip during the worldwide recession in late 2008 and 2009 — has brought the role of IT into sharp focus within many enterprises, “said Derry Finkeldey, principal research analyst at Gartner. “Business is increasingly looking to IT to help support the challenges of rapid growth for customer support, supply chain management, optimising business processes or helping to drive innovation in the business. These demands are being placed while the IT infrastructure within many enterprises may not be entirely in place. IT is also in transition from being viewed as a back-office support function to a frontline business-focused function,” she said.

“The Indian enterprise market is quite distinct from other markets in Asia/Pacific. The retail industry is expected to achieve the strongest growth in percentage terms in 2012, where IT spending is forecast to grow 11.8 percent (see Table 1). Recent decisions to allow 100 percent foreign direct investment (FDI) in single brand retail, and up to 51percent in multi brand retail, are expected to provide the sector with a significant boost in terms of IT usage and adoption. Selection of partners with deep vertical expertise will be crucial to success,” said Finkeldey.

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The best growth opportunities in terms of actual dollars will remain within the large manufacturing, government- and state-owned enterprises, communications and financial services sectors.

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Gartner recommends that vendors identify specific industry target markets, and prioritise these for the allocation of needed resources. This will drive greater project success and the creation of more value to those customers.

“Given the emergence of IT as an enabler in industries beyond manufacturing, government and financial services, now is a good time for IT providers to invest more in their channel partners. Convert them from ‘generalists’ to ‘specific industry product specialists,’ with beyond Tier 1 city capabilities. Software and hardware vendors need to engage with the Indian Big Four (TCS, Infosys, Wipro and HCL) and eventually build deep go-to-market strategies with them,” said Finkeldey.