India's IT and business services mkt to reach US$ 13 billion by Dec 2020: IDC

By December 2020, India's IT and business services market is expected to increase by 5.4% annually to reach US$ 13 billion, research firm IDC said.

In the January-June (H1) 2020 period, the segment jumped 5.3% year-on-year (y-o-y), compared to 8.9% growth in H1 2019, IDC said in a report.

The IT services market contributed 77.4% of the IT and business services market in H1 2020, increasing 5.9% y-o-y compared to 9.3% growth in the previous year.

"IT services market will start picking up momentum gradually from 2021 onwards and is projected to grow at a CAGR of 7.2% between 2019-2024, to be valued at US$ 13.4 billion by the end of 2024," it said.

IDC said, “In the first half of 2020, the growth markets for application hosting services and infrastructure hosting services continued to grow due to the increasing adoption of cloud applications.”

Network services have seen greater adoption due to increased demand for VPN licences and the need for greater network connectivity, it added.

Ms. Garima Goenka, IDC India Market Analyst, IT Services said, "In H1 2020, the role of IT services vendors gained higher significance, as organisations increasingly approached them to help ensure business continuity by putting in place various technologies, solutions, best practises and frameworks."

Organizations have made greater investments in collaborative applications, VPN licences, endpoint devices, cybersecurity solutions, cloud, artificial intelligence, and automation in these challenging times.

In addition to ensuring business continuity, IT service providers have also played a role in helping organisations achieve a greater degree of technology resilience and adaptability.

Ms. Goenka mentioned that vendors have launched AI-based applications to assist government and healthcare sectors in providing citizenship services and responding to COVID-19 related queries, and to ensure that their employees are returned to the workplace safely and securely.

IDC India Senior Research Manager, Enterprise Software and ICT Services, Ms. Shweta Baidya said, “Investments in IT across all major sectors such as BFSI, healthcare, telecommunications, IT/ITeS, government and manufacturing have increased significantly to enhance overall experience and maintain business continuity and resilience.”

She added that some of the strict requirements that provided increased flexibility with regard to work from home/anywhere policies were also relaxed by the government.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.