Despite a challenging economic environment, the enterprise software market in India is projected to reach $3.92 billion in 2013, a 13.9 per cent growth over 2012 revenue of $3.45 billion, research firm Gartner said today.
“Growing maturity of Indian users is an important driver for overall growth,” Gartner Principal Research Analyst Asheesh Raina said in a statement.
Compounding the demand is the ongoing tendency for greater customer services along with the continued drive for infotech cost savings along with the incorporation of emerging technologies like mobility, cloud and business process management, he said.
“These new technologies, and demand for agility, brings in additional urgency and demand for infotech investments,” Raina said.
In 2013, India is expected to be the fourth largest enterprise software market in Asia-Pacific. The country is forecast to account for 11.6 per cent of the region’s total revenue of $33.73 billion in 2013 and 1.32 per cent of the total worldwide software market of $296 billion.
By 2017, India’s share of the software market in Asia-Pacific is expected to reach 13.11 per cent, representing $6.7 billion in revenue or 1.74 per cent of the total global software market revenue of $383 billion.
In comparison to other countries, the software market in India is still relatively small and evolving, Gartner said.
India enjoys a rich presence of international software and hardware vendors, backed by a very strong ecosystem of system integrators, service providers and business partners, it said.
The combination of sustainable domestic demand, presence of global vendors, entry of new small vendors and what Gartner claims is the “nexus of forces” (convergence of new mobile, social, cloud and information computing environments) are the key drivers for high sustainable growth for India, it claimed.
“End users in Asia-Pacific are expecting to increase their spending on application and infrastructure software, with India and China being the most optimistic and leading the way. It is closely followed by Malaysia and Singapore,” Raina said.
Increased budgets in India are expected because of the growing economy, increased globalisation, FDI in retail, aviation, media and ongoing investment in India as a customer service-related outsourcing destination, he added.
“Optimism regarding spending within Indian organisations reflects confidence in India’s regional economic performance, as well as the need to adopt better technology to effectively compete in a tougher global environment,” he said.
In the next five years, priority areas of software spending will include web conferencing; teaming platforms and social software suites; enterprise content management; customer relationship management (CRM) and security.
Indian enterprises are looking for cost effective use of technology before adoption of these tools, resulting in the fast growth of these markets, Gartner said.