India's IT/ITeS market may grow 13.4% in 2009: IDC

Hit by the global economic meltdown, the country's IT/ITeS market is expected to grow by 13.4 per cent in 2009 to achieve revenue of Rs 1,14,574 crore, but the growth will be the slowest since 2003, says a report by global market research firm IDC.

According to IDC report, 'India Domestic IT/ITeS Market Top 10 Predictions for 2009', the country's IT/ITeS market growth rate is expected to fall to 16.4 per cent in the coming five years till 2013 from an average of 24.3 per cent during 2003-08.

This slower rate of growth will see enhanced competition leading to a rapidly changing strategy and continuous market re-alignment on the part of players, IDC said in a statement.

"2009 shall herald the beginning of a new business cycle that will be marked by slow growth but would eventually be the basis of a new phase of growth. The issues in the short run, more pronounced throughout 2009, will be productivity, cost savings and customer retention," IDC India Country Manager Kapil Dev Singh said.

"This would eventually pave way for innovative services (for both consumers as well as enterprises) by leveraging the existing infrastructure built so as to align with emerging opportunities," he added.

The realignment of businesses and the structural changes will propel a new "market order", which will be quite different from the earlier phase.

The domestic market had witnessed unprecedented growth, nearly tripling the market size from Rs 34,000 crore in 2003 to Rs 1,01,031 crore in 2008, a CAGR of over 24 per cent.

IDC also predicts the global IT spending to decrease to 2.6 per cent in 2009 against five per cent in 2008 and seven per cent in 2007.