India will be the world's third fastest growing enterprise software market through 2016, said research firm Gartner.
This market will grow 13 per cent in 2012 despite challenging economic conditions, it said. Revenue will reach $3.22 billion during the year.
The Indian market's compound annual growth rate will be 13.6 per cent from 2009 to 2016.
In 2012, India will also be the fourth largest enterprise software market in Asia/Pacific. It will account for 11 per cent of the region's total revenue of $29.33 billion for Asia/Pacific this year, the equivalent to 1.15 per cent of the total worldwide software of market share of $280 billion.
The increasing globalisation of the Indian economy is leading to a growing need for modern software with the latest features and improved functionality, said Gartner.
By 2016, India's share of the software market in Asia/Pacific is expected to reach 12.1 per cent, representing $5.4 billion in revenue, or 1.5 per cent of total worldwide software market revenue of $361 billion.
In comparison to other countries in the Asia/Pacific region, such as China (with 27 per cent share of regional spending in 2011), the software market in India is still relatively small and evolving, said Gartner.
Key areas
Priority areas of software spending include operating systems, DBMS, AIM and Application Development. In the next five, the fastest-growing segments will be Web conferencing and team collaboration, enterprise content management, CRM and ERP.
According to Gartner, Indian enterprises are lagging behind in terms of adoption of these tools, resulting in the fast growth of these markets.