"We have proposed to the government that money spent on technology by the SMBs should also be considered among the investments done by them and give them incentives," he said.

Chandrashekhar added that there is also a need to set up collaboration platforms for industry players to share best practises, enable easier access to funding and network with like-minded people to create innovative IT solutions.

F&S Associate Director Nishchal Khorana said investment in technology can help SMBs streamline operations, standardise processes, enhance productivity and quality of products and services.

"Of the overall technology solutions available, cloud adoption will be a key element to transform the ecosystem. Advantages like low capex, lesser total cost of ownership and easy data management is attracting SMB players," Microsoft India general manager SMS&P Meetul B Patel said.

He added that various stakeholders including government, industry associations and players need to work jointly to encourage IT adoption and increase awareness of existing IT solutions.

The report said SaaS adoption by SMBs in India is growing at a CAGR of over 25 percent and is expected to reach Rs 2,000 crore ($370 million) by FY18.

It added that manufacturing contributed to nearly 21 percent of domestic spend of SMB on IT, while education accounted for about 15 percent.
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