IT Budgets to grow 5.5% in India: Gartner Survey

NEW DELHI: Even as enterprises around the world face a global downturn, IT spending budgets in India, in contrast to many other regions of the world, will still grow at 5.52 per cent in 2009, says the 2009 CIO Agenda survey conducted by Gartner Inc. However, the 5.5% is a sharp fall from the 13% IT budget increase reported in 2008.

In contrast, flat IT budgets were found across enterprises in North America and Europe, with slight increases in Latin America and a slight decrease in Asia/Pacific.

"In 2009, government, utilities and healthcare will witness most growth. On the other hand, financial services and manufacturing will see a decrease. Indian companies will have to rapidly adapt in order to maintain their value proposition in the current volatile global economy," said Mr. Peter Sondergaard, global head of research at Gartner.

The worldwide survey of 1,527 CIOs was conducted by Gartner Executive Programs (EXP) from September 15 to December 15 2008 and represents CIO budget plans reported at that time.

The Gartner EXP CIO report "Meeting the Challenge: The 2009 CIO Agenda" represents an examination of business priorities and CIO strategies. The CIOs surveyed represent more than $138 billion in corporate and public-sector IT spending, encompassing 1,527 enterprises across 48 countries and 30 industries.

"In the current economy, enterprise cost optimization has become the most critical factor for the CIO", said Mr. Partha Iyengar, head of research in India at Gartner. "Despite worldwide IT budgets remaining flat in 2009, the Indian IT budget is still expected to grow at a modest 5.52 per cent. The majority of this budget-up to 60 per cent-will be used to run day to day operations of the business, while 23 per cent will be utilized to grow the business and 19 per cent will be used to transform the business".

The survey shows that CIOs in India have shifted their focus from investing in emerging technologies to increasing the return on their existing investments and infrastructure. The survey shows that CIOs in India expect to invest in business intelligence applications and information consolidation in order to raise enterprise visibility and transparency, particularly around sales and operational performance.

Companies also expected to invest in server and storage technologies to meet enterprise wide demand for these services.

They are expected to invest in ERP technologies, a focus that reflects ERP's core position in enterprise operations. CIOs also plan simplification measures in 2009 that reduce the number of ERP instances, vendors and software licenses.

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