IT services market expected to grow at 8.4% in 2014: IDC

NEW DELHI: The information technology (IT) services market in India is expected to grow at the rate of 8.4% this year compared to 2013, reaching a value of Rs 4,76,356 million ($7.69 billion), research firm International Data Corporation ( IDC) said on Monday.

In the second half of 2014, organizations are likely to raise their IT spend after the election results are out and the new government announces its policies. Increasing infrastructure spend will drive the demand for related IT services such as consulting and system integration services, IDC said in a note.

“The growing complexity of enterprise IT environments, combined with the challenge of availability of advanced technical skills, will push organizations to turn to outsourcing services,” said Sachin Chaturvedi, Senior Analyst for IT Services at IDC.

The outsourcing services market grew by close to 7.1% in the second half of 2013, compared with the same period in 2012. As clients continued to cut costs, support services grew only 5.5% in the second half of 2013, while system integration and IT consulting services grew 6.8% and 6.3% respectively due to fewer infrastructure projects.

In the IT services market, IBM and Wipro emerged as the two main players in the second half of 2013, commanding 12.1% and 7.4% of the share, followed by Tata Consultancy Services, Hewlett-Packard and HCL Technologies Limited.

Growth slowed in the IT services market in India to about 6.5% in the second half of 2013 to Rs 2,56,452 million ($4.1 billion), mainly because of cautious approach in the market and a fall in the infrastructure spend, the research firm said.