IT spending in India is set to reach USD 160 billion in 2025, with software spending expected to grow at a rate of 17 per cent. Gartner predicts that more than 50 per cent of application software offerings with GenAI capabilities will have a price premium by 2025. Indian CIOs are expected to allocate budgets for GenAI and increase spending on technologies like cybersecurity, business intelligence, and data analytics in 2025 compared to 2024.
Despite cautious spending globally, IT services spending in India is projected to grow by 11.4 per cent in 2025. The growth in software spending is expected to be driven by the price premium of GenAI-enabled offerings in areas such as CRM, email, and analytics platforms. Service engagements around cloud, application, and consulting are also expected to drive growth in India’s IT sector.
Data center systems spending in India is projected to reach USD 4.7 billion in 2025, driven by the increasing need for new infrastructure to support AI integration. Data center providers, including hyperscalers, are expanding their presence in India to meet the growing demand for data storage and computing capacity while complying with regulatory requirements.
Gartner’s IT spending forecast methodology is based on a detailed analysis of sales data from a wide range of vendors. Primary and secondary research sources are used to build a comprehensive database of market size data, which informs the forecast. GenAI’s role in delivering industry use cases and improving labor productivity will be a key focus for Indian enterprises in 2025 and beyond.
The growth in IT spending in India is expected to be driven by expansion in both application and infrastructure software markets. Indian CIOs are anticipated to increase their budgets for GenAI and prioritize spending on technologies like cybersecurity, business intelligence, and data analytics in the coming years. Service engagements around cloud, application, and consulting are also predicted to contribute to the growth of India’s IT sector.
With the rising enterprise need for new infrastructure to support AI integration, data center systems spending in India is projected to increase in 2025. Data center providers, including hyperscalers, are expanding in India to meet the demand for increased data storage and computing capacity. GenAI’s capabilities and the evolving pricing options for software offerings are expected to be key factors driving the growth of India’s IT sector in the coming years.
