India’s Technology Spending to Reach US$54.5 Billion in 2024: Report

Posted by Written by Archana Rao Reading Time: 2 minutes

India’s technology spending is expected to reach approximately US$54.5 billion, growing by 8 percent, thereby marking the highest growth rate in the Asia Pacific (APAC) region in 2024. Due to a comprehensive drive towards digitization by both the central and state governments, India’s domestic IT business is experiencing robust growth.

A newly published industry report forecasts that technology investment in the Asia Pacific (APAC) region will grow robustly, at a compound annual growth rate (CAGR) of 6.4 percent to 7.4 percent from 2024 to 2027, reaching US$876 billion.

According to Forrester’s ‘Asia Pacific Tech Market Forecast, India’s spending on software will continue its rapid growth over the next few years. It will be followed by spending on information technology (IT) services, communications equipment, and computers. In 2024, the country’s tech spending growth is expected to reach U$54.5 billion. 

The report predicts that the share of software purchases will climb from 26.4 percent in 2024 to 30 percent of total technology spending in 2027, outpacing the other IT categories due to demand generated by artificial intelligence (AI) and AI-augmented enterprise software and services. The report highlights that India’s technology economy is thriving due to extensive digitization efforts from the government, both at federal and state levels.

Mapping the APAC tech landscape

In six major Southeast Asian economies (Indonesia, Malaysia, Philippines, Thailand, Taiwan, and Vietnam), technology spending is expected to reach US$74 billion in 2024, reflecting 1 percent growth. The report states that digital innovation in these countries is being accelerated by increased digital consumption among large millennial and Generation Z populations, favorable policies, and investments by technology giants.

After India, Singapore will see the second highest growth in tech spending in the APAC region in 2024, at 5 percent, reaching US$18 billion. Australia’s tech spending will increase by 4 percent, reaching U$49 billion, primarily driven by sustainability initiatives and the country’s resilient local services sector.

For China, the report forecasts digital spending of up to $261.9 billion, with the country maintaining the largest overall tech spending in APAC. 

The principal analyst at Forrester believes that despite challenges, such as regulatory environments, global economic conditions, and talent shortages, the APAC market is well-positioned for tech growth. The rise of AI and the increasing demand for cloud services present significant revenue and growth opportunities for firms in the region.

Key takeaways

India is poised to lead tech spending growth in APAC with an anticipated increase to approximately US$54.5 billion in 2024, marking an 8 percent rise fueled by robust digitization efforts from both central and state governments.

The broader APAC region is projected to maintain strong growth momentum, with tech investment expected to surge to US$876 billion by 2027, driven by increasing expenditures in software, IT services, and advanced technologies like AI.

Despite challenges, including regulatory complexities and talent shortages, the region’s favorable policies and rising digital consumption among millennials and Gen Z are accelerating innovation and presenting lucrative opportunities for tech firms.

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