International Data Corporation has forecast that the information technology market size in India would grow to $44.8 billion in 2014 from $35.1 billion in 2012.
In its report, the India IT Market Overview 2013-14, IDC said the growth will be rapid in emerging Tier-II and Tier-III cities, emerging segments such as upper mid market and emerging verticals such as education and healthcare.
“While the US showed signs of economic recovery and Europe continued its downward slide, there was a considerable, if not substantial, impact on Asia Pacific countries. India continues to be in choppy economic waters currently, characterised by a weak investment environment, depreciating rupee and tight credit conditions – these factors are causing companies to spend frugally,” Jaideep Mehta, Country General Manager at IDC India, said in the report.
India's strong fundamentals—high savings rates, rapid workforce growth and expanding middle class—will continue to support brisk economic expansion in the mid- to long-term, he said.
The impact of economic reforms in early 2013 such as relaxation of FDI regimes in select industries is expected to drive inbound investments and have a broader positive impact going forward.
"The increase in IT investments by Indian small and medium enterprises indicates constant progress in business maturity levels. Investments from the mid-market segment is expected to grow at a significant rate of 17.2 per cent. Government initiatives and public private partnerships are bridging infrastructure and research and development gaps that inhibited SME growth," Pavan Magge, Senior Analyst (Consulting Group) of IDC India, observed.