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IT spending in India to decline by 8% in 2020 due to Covid-19: Gartner
- By Elite CIO
Jun 07, 2020
11
IT spending in India to decline by 8% in 2020 due to Covid-19: Gartner
Source :https://www.gartner.com/en/newsroom/press-releases/2020-06-03-gartner-says-it-spending-in-india-to-decline-8--in-20
Issue Date : Press Release 03rd June 2020
Information technology (IT)spending in India is expected to see a decline of 8% to $83.5 billion in 2020,according to a forecast by research firm Gartner.
Last month, Gartner revised itsglobal IT spending prediction for the year. It warned of an 8% decline, withthe overall IT budget to fall to $3.4 trillion, due to the Covid-19 crisis.
“The fear of a global economicrecession due to the Covid-19 pandemic is forcing chief information officers(CIOs) in India to be very cautious about their IT spending this year. Inpartnership with their CFOs, CIOs in India are reprioritizing their IT budgetson mission-critical initiatives,” Naveen Mishra, Senior Research Director,Gartner said in a statement. This is the first such decline in five years.
The pandemic has forced CIOs inIndia to spend more on business continuity, remote working and workforcecollaboration.
Investment on devices and datacentre systems in India is set to record the steepest decline in 2020, at-15.1% and -13.2%, respectively, the statement said.
Spending on devices and data centresystems in India are on pace to record the steepest declines in 2020, at -15.1%and -13.2%, respectively (see Table 1.) CIOs in India will consider extendinglife cycles of their existing device assets which will delay new purchases.
Table 1. India IT Spending Forecast(Millions of U.S. Dollars)
2019 2019 2020 2020
Spending Growth(%) Spending Growth(%)
Data Centre Systems 3,670 1.4 3,186 -13.2
Enterprise Software 6,287 11.7 6,125 -2.6
Devices 36,595 7.0 31,077 -15.1
IT Services 15,573 10.5 14,924 -4.2
Communications 28,744 -1.7 28,227 -1.8
Overall IT 90,869 4.7 83,540 -8.1
Source: Gartner (June 2020)
However, technologies such astelehealth, smart- chatbots, mobile applications enabling deliveries, anddistance learning education software will see an increase in spending in 2020.Spending on enterprise software will see a moderate decline of -2.6%, in 2020.
“The lockdown measures forcedsectors such as education, healthcare, and public utilities to accelerate theirdigital transformation. However, sectors such as retail, insurance, and bankingthat were already advanced in their digital transformation have to reduce theirIT spending in 2020,” Mishra added.
Global IT spending was projected tohit $3.9 trillion in 2020, an increase of 3.4% from 2019, according to a reportby Gartner released this year in January. Investment in the sector took anosedive since the emergence of Covod-19 pandemic and the resultant economicdownturn.
According to a separate forecast byGartner during last year in November, the information technology spending inIndia was expected to hit $94 billion in 2020, which is a 6.6% increase from$88.5 in 2019. Around the same time, Gartner said that end user spending oncloud services in India will increase by 25% to touch $3.4 billion in 2020.
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The information provided herein ison “As Is” basis, without warranty of any kind.