India IT outsourcing market up 7% to $7719 mn in 2014

The Indian IT outsourcing market grew 7.1 percent to $7719 million in 2014, said IDC.

In the second half of 2014, the IT services market saw slight uptick primarily on the back of higher demand for hosted infrastructure, hosted applications services, custom application development, IT consulting, application management services and infrastructure projects.

The expanding start up community and technology adoption by SMEs, who favor Opex against Capex model of IT, is creating demand for hosted infrastructure, hosted application, managed and data center services.

Project-oriented services such as systems integration, network consulting and integration, custom application development and IT consulting grew 7 percent during H2 2014. The total IT outsourcing services market grew at 6.8 percent during the same period while support and training services grew 6.5 percent.

IT outsourcing market in India
Within the BFSI vertical new banking licenses awarded by RBI, increasing technology adoption by Non-Banking Financial Companies (NBFCs) and microfinance institutions pushed the demand for IT services.

In retail vertical emergence of e-commerce continues to be a key growth driver. The new age e-commerce players are making technology investments themselves and forcing brick and mortar players to embrace technology. Healthcare, services and government are also investing in IT services in India.

Local IT Services market will grow at a compound annual growth rate (CAGR) of 10.8 percent (in INR) between 2014 and 2019 — driven by license awards for Payment Banks and Small Scale Banks, Digital India, smart cities etc., said IDC.

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