Indian IT, Business Services market grows 6.4% to $6.96 billion in H1 2021: IDC

The Indian IT and Business Services market recorded a 6.4% year-on-year growth in the first half of 2021 and was valued at $6.96 billion, research firm International Data Corporation (IDC) said on Wednesday. The research firm said that the IT and Business services sector registered a 5.1% growth in the first half of 2020.

“The increase in growth rate was primarily due to the continued focus on digital transformation initiatives by enterprises in the country,” it added.

The IT Services market contributed 78% and grew by 7.3% in H1 2021, as compared to the 5.7% growth in the year-ago period.

According to IDC, the IT and Business Services market is set to gather steam in the upcoming cycles due to the revival of the economy and increased spending in areas such as cloud, security, artificial intelligence, etc.

The research firm classifies the IT & Business Services market into three primary markets – project-oriented, managed services, and support services.

It projects the IT and Business Services market to reach $19.93 billion by the end of 2025, growing at a compound annual growth rate (CAGR) of 8.2% between 2020-2025.

“Despite the harsh second wave of the Covid-19 pandemic, enterprises continued to invest in digital transformation initiatives to address the change in business models, streamline operations, enhance customer and employee experience, and improve overall resiliency,” IDC India senior market analyst (IT services) Harish Krishnakumar said.

During the first half of 2021, project-oriented services registered the highest growth rate at 7.2%, followed by managed services at 6.2%, and support services at 5.3%.

“1H2021 turned out to be the year that showcased that enterprise resiliency strengthened at a remarkable pace. Most enterprises witnessed a bounce back with business reaching the pre-pandemic situation,” IDC India Senior Research Manager (Enterprise Software and ICT Services) Shweta Baidya said.