New Delhi: Government of India’s IT spending is expected to grow 9.4% year-over-year (YoY) to $ 7.3 billion in 2021, Gartner Inc said in its latest India forecast.
Increased expenses will be driven by various Digital India The initiative is expected, including the first digital census this year. Presenting the Union Budget 2021-22, Finance Minister Nirmala Sitharaman had announced an allocation of Rs 3,768 crore for digital consensus.
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Gartner estimated that government spending on software, including applications, infrastructure, and vertical-specific software, is expected to grow at a higher rate of 13.4% annually. Device spending will increase by 11.8%, followed by growth in IT services, which is likely to grow by 11.2%. Expenditure on data centers, telecommunications services and internal services will increase by single-digit, with an increase of 7.8%, 6.3% and 5.7%, respectively.
Gartner’s chief research analyst, Apeksha Kaushik, said, “Due to the Covid-19 outbreak, the Government of India’s digital transformation projects were sidelined in 2020. The government will move from a cautious expense to open fiscal floods in 2021. ”
The adoption of artificial intelligence (AI), cloud services and blockchain will be the major focus areas for the Indian government in 2021.
“The deteriorating economy forced the Indian government to reduce its IT spending across sectors,” Kaushik explains.
IT spending by 2020 fell into the segment by the government. For example, spending on equipment fell by 20.1%, internal services by 10.9%, data center by 10%. Overall, government IT spending declined by 9.9% in 2020.
Compared to India, global IT spending by other governments is projected to grow at a total annual growth rate of 5.1% to $ 482,800 million during 2021. Spending on software services is expected to grow 9.2% globally, while investment in other verticals is around 5%. The only exceptions are internal services, with a 2.4% decline expected.
“The epidemic exposed the capabilities of government organizations to the quick response, scale, and vulnerabilities of secure services,” said Gartner Senior Research Director Irma Fabular.
Fabular points out that governments are innovating at a rapid pace by adopting commercially available technology solutions for operational and mission critical needs.
According to NASSCOM estimates, India’s IT sector is set to achieve a 2.3% growth in revenue to $ 194 billion in FY21.