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India domestic IT market to grow 20%: Gartner
By agencies
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Monday, 04 July 2005, 19:30 IST
NEW DELHI: India's domestic information technology industry is forecast to grow a compounded 20 percent through 2009 as firms increase efficiency through computerization, research firm Gartner said on Monday.
Improved infrastructure, strong demand from the financial sector and rapidly dropping costs will also help expand the $2.14 billion market where the primary source of revenue is from large deals between companies, Gartner said in a statement.
"Improving business confidence, a robust economy growing stronger, improved availability and quality of infrastructure at a lower cost and increased presence of multinationals will drive most of the growth," Ravindra Datar, Gartner's principal analyst for the Asia-Pacific region, said.
Datar estimated the domestic market would grow to $5.29 billion by 2009 as the government spends more on technology to reduce administration costs and global firms increase their back-office operations in India.
Asia's fourth largest economy has already become a globally recognized hub for the outsourcing driven back-office industry that employs about 350,000 people. The booming sector has grown more than 50 percent a year since 2001/02.
Gartner expects the growth in India's domestic IT services market from 2005 to 2009 to outpace the projected 8.9 percent expansion in the Asia-Pacific market and also the global growth rate of 6.1 percent.
"Emerging markets such as India and China are the main engines of growth across the region in the next few years," the statement said.