India’s tech spending hits highest growth rate among APAC nations

India’s technology spending is estimated to scale $54.5 billion (approximately Rs 4.49 lakh crore) in 2024, according to Forrester’s ‘Asia Pacific Tech Market Forecast, 2023 to 2027’

India’s technology spending is estimated to scale $54.5 billion (approximately Rs 4.49 lakh crore) in 2024. This marks a growth of around 10.8 per cent, which is the highest among nations in the Asia Pacific (APAC) region, according to Forrester’s ‘Asia Pacific Tech Market Forecast, 2023 to 2027’.

“Estimated to reach Rs 4,492 billion in 2024, India’s domestic tech economy continues to enjoy strong growth due to an all-round digitisation push from the central and state governments,” the report by the global market research company Forrester said.

Overall, technology spending in the APAC nations would reach $876 billion in 2027, surging at a compounded annual growth rate (CAGR) of 6.4 per cent to 7.4 per cent from now to 2027, according to the report.

AI TO DICTATE SOFTWARE SPENDING

Spending on software purchase will dominate spending patterns owing to demand generated by AI and AI-augmented software and services, followed by spendings on IT, communications equipment and computer equipment, according to the report.

“Over the next few years, software spending will continue its rapid growth, followed by spend on IT services, communications equipment and computer equipment. The share of software purchases will climb from 26.4 per cent in 2024 to 30 per cent of total tech spend in 2027, outpacing the other IT categories due to demand generated by AI and AI-augmented enterprise software and services,” the report said.

CHINA A BIG SPENDER

While China at 7.2 per cent will have a lower growth rate of tech spending than India in the given time frame, the country would continue to be the largest spender on technology among APAC nations in absolute terms, at $261.9 billion. China has seen a slump in economic growth as well as trade restrictions, but the country’s initiatives to control risks associated with AI by launching the right regulations would help its growth, the report said.

Among other leading APAC nations, Singapore would be spending around $18 billion on technology at 5.6 per cent while Australia would spend $49 billion at 4 per cent. Indonesia, Malaysia, the Philippines, Thailand, Taiwan and Vietnam — the six big Southeast Asian economies — are together estimated to spend $74 billion this year.