Tech spending in India to grow 8.2% in FY22: Forrester

Indian tech spending is expected to grow 8.2 per cent in 2022, Forrester forecasts in a new report “Asia Pacific Tech Market Outlook By Country For 2021 and 2022.”

February 9, 2022

Considering the Southeast and Asia regions, China is expected to grow substantially (In addition to India) mainly in the APAC Technology sector by 6.2% in FY22.

Hardware and software sectors can descend from 6-7% during FY21 to 4-5% in FY22.

During the FY22, Software spending is expected to outgrow at 14.6%, marginally lower than 14.8% as estimated in 2021.

Indian CIOs must have future-proof strategic plans, states a new report.

Tech spending in Indian companies is expected to grow 8.2 per cent in 2022, according to a new report by Forrester. Titled “Asia Pacific Tech Market Outlook By Country For 2021 And 2022.” The report states that “continuous improvement in vaccination rates and the progressive reopening of economies” are likely to increase the growth of the tech sector in 2022 in the Asia Pacific region. It is projected to be at par or higher than previously recorded in the pre-pandemic era. Further, the APAC tech market is expected to rise by 6.2% in the current FY22. Southeast Asia, China and India are currently prospering. 

Considering the Southeast and Asia regions, China is expected to grow substantially (In addition to India) mainly in the APAC Technology sector by 6.2% in FY22. During FY21, though India spent 9.8% indicating a steady growth, the APAC technology market rose by 6.4%. 

Software Industry overtakes

As per a Gartner Report, the economy will fully recover by 2022. 

Tech hardware spending picked up in 2021 while software performed best in the overall tech market. After cutting hardware spending in 2020, Indian tech leaders will spend 7 per cent more on it in 2021. Communication equipment also witnessed a strong 6.9 per cent growth in 2021 with telcos expanding their investment in and trials of 5G. Software was the only spending category that did not take a significant blow during the 2020 contraction, and we expected its growth to jump to nearly 15 per cent in 2021, Gartner said. 

During the FY22, Software spending is expected to outgrow at 14.6%, marginally lower than 14.8% as estimated in 2021. IT Outsourcing services along with the hardware upkeep industry is likely to grow 11.2% in addition to IT consulting services. Hardware and software sectors can descend from 6-7% during FY21 to 4-5% in FY22.

India’s privatization plans focusing on the aviation and banking sectors have further accelerated the industry to prevail. 

Corporate sector plans to spend generously 

Indian CIOs must have future-proof strategic plans, states a new report. FY21 saw the Indian IT sector rise to new heights when compared to the global average. 

This comes as firms focus on “pragmatism, revenue growth and market performance”, as per a Forrester report. The Forrester Analytics Business Technographics Priorities And Journey Survey, 2021 that was fielded from November 2020 to January 2021. 21,130 respondents in Australia, Canada, China, France, Germany, India, the UK, and the US participated in the surveys, from companies consisting of two or more than two employees.

In the Forrester survey, 53 per cent of Indian purchase influencers said that their firm spent more on tech products and services in 2020 than in 2019, while 75 per cent said their firm would spend more in 2021 than in 2020. 42 per cent expected spending to increase by 5-10 per cent.

Along with Interest in automation, new trends like Web 3.0, NFTs and Cryptocurrencies have also been the most-talked about lately. 

“However, the disruption spurred companies to pivot toward automation, cloud, and AI capabilities to improve the quality, scale, and reliability of customer-facing services. This marks a major digitisation milestone and a broader forcing function for process modernisation across the ecosystem,” states the report.