Posted by New Delhi: India’s technology services sector expected to touch $300-350 billion in annual revenues by 2025, according to Nasscom‘s new report.
The report revealed that India’s technology services sector could accelerate growth by 2-4% over the next five years, reaching $300-350 billion in annual revenues.
However, this will depend on how the sector can win in the cloud, AI, cybersecurity, and other emerging technologies. This will require closer collaboration among stakeholders across the private sector, academia and the government.
Nasscom’s new report ‘Future of Technology Services – Winning in this decade’ illuminate the growth observed by the IT services sector and provide insights into how to create impact and sustain growth in an ever-changing marketplace.
As knowledge partners, McKinsey & Company conducted independent third-party research and analysis for this report.
With the consumers’ ever-evolving needs, enterprises are keeping up with continuous innovation, leading to a shifting global marketplace and 10% annual growth in the IT services sector, generating high returns for shareholders and investors in the last decade.
Technology services valued at around $1 trillion today. It is now among the most significant contributors to economic growth worldwide, especially in India. India’s technology services sector now generates about 27% of the nation’s exports and provides livelihoods to about 4.4 million people.
Despite this, players across the sector face challenges like driving growth in revenue per employee and providing them with digital skills. However, with the government playing a more significant role in digital services, increased investment and innovation, and the rise of regional power centres dominated by local players, businesses and the industry will see a massive transformation in the next decade.
Fueling over 50 digital initiatives across sectors like banking and finance, healthcare, governance, etc., the technology services industry continues to be a prime driver of India’s digital dream with a contribution of 8% to the overall economy.
With the ongoing pandemic, almost every sector has pushed its digital transformation efforts increasing cloud consumption and other digital services like Artificial Learning (AI) and Machine Learning (ML).
The growing demand for digital and cloud services is creating a potential market opportunity to reach $600-700 million by 2025. Coupled with cybersecurity, IoT and digital spending, the technology services are expected to reach $300-350 billion in revenues by 2025.
“India’s technology services sector can utilize the potential of deep technologies like cloud, artificial intelligence, machine learning, IoT, etc., through effective transformational practices, thereby contributing to the overall economy in the coming decade,” said Debjani Ghosh, President – Nasscom.
The government needs to encourage and support digital literacy and skilling to ensure its talent, energy, imagination, knowledge and unmatched commitment unites to address the customers’ surging needs. It is equally vital for India to reach a new level of cooperation to continue the remarkable growth observed in the sector.
“At NASSCOM, we look forward to helping bring people, companies, the government, universities, investors, and customers together to drive innovations that we cannot imagine today—and that will make the nation and the world better, safer, cleaner, more prosperous places,” added Ghosh.