India IT spending to grow 8% in 2016 against 13% in 2015: IDC

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India IT spending is expected to grow 8 percent in 2016 against 13 percent growth achieved in 2015, according to IDC.

IT spending in India rose 13 percent last year, driven by a strong PC market, which was propelled by government initiatives and education projects.

A slowdown in PC revenues and more difficult comparisons for cloud infrastructure spending will result in weaker overall IT spending growth of 8 percent in 2016. IDC forecasts accelerating growth in software and services. India will rebound to double-digit growth in 2017, and will represent an increasingly vital source of growth for global IT suppliers over the next five years.

India’s expected rate of growth will see it overtake Australia and Canada to enter the top 10 largest IT markets by 2020.

IT spending in Asia Pacific will grow less than 2 percent in 2016 against 7 percent in 2015, largely due to the overall slowdown in China.

The IT market in Japan is expected to stabilize, recovering to growth of 1.5 percent after posting a slight decline in 2015.

IT spending globally

Overall IT spending in the BRIC markets of Brazil, Russia, India and China will increase by 1 percent in 2016.

Globally, IT spending on hardware, software and services is expected to increase 2 percent in constant currency to $2.3 trillion in 2016.

Including telecom services, ICT spending will increase by 2 percent to $3.8 trillion, according to the latest data from the International Data Corporation (IDC) Worldwide Black Book.

Economic weakness in emerging markets and saturation of the smartphone market will result in a significantly slower pace of tech spending growth compared to the past six years.

Smartphones accounted for half of the overall industry growth rate of 6 percent in 2015. Spending on cloud infrastructure was also strong, resulting in 16 percent growth for the server market and 10 percent for storage systems.

Enterprise spending on software, including SaaS, posted 7 percent growth with investment in analytics, security, and collaborative applications.

In US dollar terms, the overall IT market declined 2 percent last year.

IT spending in China has been a growing source of revenue for tech vendors in recent years, and the market grew 11 percent in constant currency last year, driven by growth in smartphones and cloud infrastructure.

Overall IT spending is expected to decline 0.3 percent in China this year. The smartphone slowdown is more heavily related to market maturity than economic weakness. There will be a decline in PC sales, and softening growth of spending on servers, storage, and peripherals.

The software market in China accounts for 5 percent of overall IT spending compared to 30 percent in the United States.

IT spending in the US will increase 4 percent despite expected decline in the PC market and weakening growth in servers and storage.

US businesses continue to invest strongly in 3rd Platform solutions around Big Data, Cloud, Mobile and Social. The  4 percent annual growth in IT spending is likely to continue in 2017, assuming the overall economy remains in line with current expectations, said IDC.

Baburajan K
[email protected]