India IT spending to grow 2.6% in 2023 to $112.4 billion, says Gartner

This compares with the 5.1% year-on-year growth seen in global IT spending for the same period.

The spending will jump to $112.4 billion for the calendar year compared to $109.6 billion in 2022. It grew 1.9% year on year in 2022. Gartner forecasts weakening demand for devices in 2023 as device upgrades are seen to stabilise after a post-pandemic boom.

Spending on data center systems will also experience a decline as businesses opt for public cloud services. End-user spending on public cloud in India is forecast to grow 27% year on year in 2023.

Devices spending is expected to contract for the second year in a row – falling 1.2% to $47.8 billion and data centre systems spending is expected to fall 1.4% to $3.4 billion.

There has been an “exodus” from on-premise storage of data and systems to the cloud. Except for these two, all the other segments of IT spending will experience growth in India in 2023.

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The devices spending is still lower compared to high base in the previous years as enterprises and consumers bought laptops, networking and communication devices to aid their remote work during the pandemic.

“Inflation has not impacted enterprise spending on technology globally, and India is no exception to this trend,” said Arup Roy, vice president analyst at Gartner. “The headwinds are in favor of technology as businesses realized how going digital can benefit them in the long run. Depending upon the maturity level of the digital enterprise, the spending context may be different for different businesses, but overall technology spending will continue to be on the rise in 2023.”

The US-based research firm said inflation, public policy changes, supply chain constraints due to international conflicts will have an “mixed” impact on the IT spending in 2023 while definitely causing changes to the buyer behaviour.

Digital technologies may see an uptick while there may be vendor consolidation in certain areas. The trends were as discussed by Gartner analysts at its flagship 3-day IT Symposium taking place in Kochi.