India IT & business services market to reach $14.3 bn by 2020: IDC

India's IT and business services market is likely to grow by over eight per cent to reach USD 13.1 billion by the year-end and expand further to USD 14.3 billion by 2020, according to research firm IDC.

Of the total market, IT services segment contributed about 76 per cent in the second half of 2018, it said in a report.

"The IT services market is slated to reach USD 10 billion by December 2019, growing at 9.1 per cent annually. The Indian government's higher spending on the Digital India and Smart Cities initiatives, and the increased adoption of next-gen technologies by organizations is driving growth in the IT services market," the report added.

IDC estimated that the IT services market will grow at a CAGR (compound annual growth rate) of 8.6 per cent between 2019-2023 to reach USD 14 billion by the end of 2023.

"The India IT & Business Services market is expected to grow annually by 8.8 per cent to reach USD 13.1 billion by December 2019, the report said, adding that the "market is further expected to register an annual growth rate of 8.7 per cent to be valued at USD 14.3 billion by December 2020".

In India, growth in the IT services market is being propelled by the banking, financial services and insurance (BFSI) and the government verticals, IDC India Director Enterprise Solutions Ranganath Sadasiva said.

"The other emerging verticals which are expected to adopt IT Services and futuristic technologies more aggressively in the next 3-5 years are the manufacturing, retail, healthcare and education verticals," Sadasiva added.

Additionally, a number of technology start-ups offering niche solutions in artificial intelligence, machine learning, Internet of Things, blockchain, automation, etc have come up, which is further driving adoption of IT services in the country, he said.