India software market continued to display the strongest growth trajectory with the highest growth across the APeJC region
The India software market is estimated to surpass USD 8.2 billion by the end of the calendar year 2021, according to the International Data Corporation (IDC) Worldwide Semiannual Software Tracker 1H21 (January-June).
India software market was pegged at USD 4.0 billion in 1H21, registering a growth of 15.9% year-over-year. India accounted for a share of 18.3% of the overall Asia-Pacific excluding Japan and China region software market during 1H21. Microsoft, Oracle, and SAP maintained their leadership position in the India market during the first half of the year.
"Indian enterprises have ramped up their investments on cloud for scalability, AI to leverage data accurately and serve the clients more efficiently, and security to protect their network & systems with greater emphasis on SASE & Zero Trust frameworks, identity management solutions, among others,” says, Hemanth Gudiwada, Associate Market Analyst at IDC India.
Collaborative applications, engineering applications, content workflow & management applications, customer relationship management (CRM) applications, and enterprise resource management (ERM) applications are leading the software segment in terms of revenue, as per the current estimates. The collaborative applications market witnessed the highest growth of 40.1% followed by system and service management software and artificial intelligence platforms at 31.8% and 30.7% respectively.
Indian Market Forecast
With cloud migration becoming a priority, IDC estimates India’s overall software market to grow at a compound annual growth rate (CAGR) of 14.0% during 2020–2025. Further report stated that the contribution of platform-as-a-service (PaaS) and software-as-a-service (SaaS) markets to the overall software market to increase from 37.1% in 2020 to 59.0% in 2025, growing with a CAGR of 25.1% with more emphasis on PaaS solutions. Acceleration in demand for technologies such as robotic process automation (RPA) software, artificial intelligence (AI) platforms, conferencing & collaborative applications, IT service management (ITSM) software, digital commerce applications, among others is also being expected.
As the policies regarding data protection and data residency have become clearer, it is projected that Indian enterprises will relook at their existing compliance frameworks and rework to align with the latest policies. As a result, data security and privacy compliance solutions will continue to be a top technology investment priority. Cloud management, advanced analytics, customer experience, and security will continue to be an important technology area focus for companies focusing on digital strategy.
“The corresponding software markets are experiencing accelerated growth, and the growth in these markets is expected to continue for the next couple of quarters. Tech providers are continuing to invest in India to fully utilize the opportunity and explore untapped potential across Indian enterprises,” added Gudiwada, Associate Market Analyst at IDC India.