India's IT spend to reach $124.6 billion in 2024, up 10.7%: Gartner

Surge in tech expenditures will be propelled by IT services, devices, and software, shows latest forecast by Gartner

India’s information technology (IT) spending is anticipated to reach $124.6 billion in 2024, reflecting a 10.7 per cent increase from 2023, according to the latest forecast by Gartner. This follows a period of flat growth (minus 0.5 per cent) in 2023. The upswing will be driven by investments in software, IT services, and devices.

The biggest year-on-year increase is expected in the devices and IT services segment. Gartner predicts a 10 per cent growth in devices spending in 2024, rebounding from a negative growth of minus 7 per cent in 2023. Similarly, IT services, which grew by 6.5 per cent in 2023, is anticipated to surge by 14.6 per cent in 2024.
 

Naveen Mishra, vice-president (V-P), team manager at Gartner, said in a media briefing, “Indian organisations are expected to invest in artificial intelligence (AI) and automation during this period as a strategic effort to enhance operational efficiency and address the ongoing shortage of IT talent. However, it is not until 2025 that generative AI (GenAI) will begin to carve its place in IT budgeting among Indian organisations.”

The trend in India’s IT spending aligns with global patterns.

Gartner predicts an overall IT growth of 8 per cent for 2024, compared to 3.5 per cent in 2023.

IT services is expected to see a growth of 10.4 per cent in 2024, up from a single-digit growth of 7.3 per cent in 2023.

Despite the buzz around GenAI, it is not projected to be a major spending factor until 2025.

John-David Lovelock, distinguished V-P analyst at Gartner, observed, “In 2023 and 2024, very little IT spending will be tied to GenAI. However, organisations are continuing to invest in AI and automation to increase operational efficiency and bridge IT talent gaps.”

Mishra added that while investments in AI and GenAI will contribute to IT spending growth in India, their impact on IT spending levels will not be evident until 2025.

“GenAI will account for a small portion of IT spending through 2024,” said Mishra.

The good news is that devices, incorporating phones, smartphones, laptops, and personal computers, are poised for a comeback.

“Device growth will be driven by numerous product launches expected in 2024. This will be fuelled by consumers’ need to refresh their devices, especially phones. Enterprises are also in a refresh cycle, albeit to a smaller extent,” added Mishra.