Spending in IT sector to hit $139 bn in 2024, growing at 13.2%: Gartner

Spending in the Indian information technology (IT) sector is projected to reach $138.9 billion in 2024, compared to $122.6 billion last year, with a double-digit growth rate of 13.2 per cent, according to recent projections from Gartner.

The growth is expected in all major segments, including software, devices, IT services, and data centre systems.

Across segments, software spending in India is projected to record the highest growth rate of 18.6 per cent in 2024, followed by devices, which is expected to grow at 13.8 per cent.

“Indian chief information officers (CIOs) are continuing to prioritise growth, customer experience, and operational efficiency while leveraging software assets in this challenging environment. Recurring revenue models are playing a significant role in optimising IT costs and driving software spending,” said the report.

On generative artificial intelligence (GenAI) spending in India, the report said that in the short term, the revenue generated from it will be minimal, as Indian CIOs are currently in the planning and evaluation stage regarding the technology.

According to the projections, worldwide IT spending is expected to total $5.06 trillion in 2024, an increase of 8 per cent from 2023.

Fuelled by the demand for GenAI processing, spending on data centre systems is also expected to see a notable jump in growth from 4 per cent in 2023 to 10 per cent in the current year globally, according to the projections.

“We are seeing a cycle of story, plan, and execution when it comes to GenAI. In 2023, enterprises were telling the story of GenAI, and in 2024 we are seeing most of them planning for eventual execution in 2025,” said John David Lovelock, vice president and analyst at Gartner.

In 2024, AI servers will account for close to 60 per cent of hyperscalers’ total server spending, according to the study.

“There is also gold rush-level spending by service providers in markets supporting large-scale GenAI projects, such as servers and semiconductors,” said Lovelock.

Gartner also projects growth in the devices segment spend, with the sector expected to achieve $688 billion in spending during 2024, up from 2023 spending lows of $664 billion, at a growth rate of 3.6 per cent.

“The integration of GenAI capabilities in premium and basic phones sustains, more than drives, this change,” said the report.

India IT Spending Forecast (in million dollars)