Research firm Gartner has forecast a turnaround for the IT industry with a growth in IT spending globally and in India, in particular. 

In India, IT spending is estimated to grow 13.2 per cent in 2024 to $138.9 billion, from $122.6 billion in 2023, which had witnessed meagre growth of 1.4 per cent.

The rebound is expected in all major segments, including software, devices, IT services and data centre systems.

Gartner said it is increasing the growth forecast for global IT spending to 8 per cent from 6.8 per cent forecast last quarter, or a doubling from 3.8 per cent in 2023.

It said global IT spending may cross the $5-billion mark in 2024, from $4.68 billion last year.

“This is an increase from the previous quarter’s forecast of 6.8 per cent growth and puts worldwide IT spending on track to surpass $8 trillion well before the end of the decade,” it said.

The bulk of the increased spending would come from generative AI efforts.

India growth story

In 2024, software spend in India is projected to grow at a record 18.6 per cent. Indian CIOs continue to prioritise growth, customer experience, and operational efficiency while leveraging software assets in this challenging environment, the report said.

“Recurring revenue models are playing a significant role in optimising IT costs and driving software spending. Additionally, Gen AI is bringing a renewed sense of optimism by unlocking new opportunities for growth and innovation,” Gartner said.

Spending on devices is expected to jump from -2.1 per cent in 2023 to 16.9 per cent in 2024, reflecting global trends, to reach $55.84 billion ($47.75 billion). Spending on software is expected to grow by 18.6 per cent to reach $17.48 billion ($14.73 billion).

“Technology providers are required to be a step ahead of this cycle and are already in the execution phase. They are bringing Gen AI capabilities to existing products and services, as well as building use cases in different sectors,” said John-David Lovelock, Research Vice President and analyst at Gartner.

“With spending on IT services on track to grow by 9.7 per cent to eclipse $1.52 trillion globally, this category is on pace to become the largest market that Gartner tracks,” he said.

“There is also gold-rush level spending by service providers in markets supporting large-scale Gen AI projects, such as servers and semiconductors,” Lovelock said.