- ByStartupStory | February 17, 2024
The Indian information technology (IT) sector is forecasted to experience a modest growth of 3.8% in FY24, reaching a total revenue of $253.9 billion, primarily attributed to the challenging economic climate.
Nasscom, the trade body representing the Indian IT industry, acknowledged a significant decline in global tech spending by around 50% and a 6% decrease in tech contracts in 2023.
“The technology industry in India, similar to global markets, is currently navigating a tough terrain,” Nasscom stated in its annual review, reflecting on the challenging environment.
Despite the subdued economic conditions, the industry managed to add only 60,000 net jobs in the current fiscal year, bringing the total headcount to 5.43 million.
“Based on the cautionary demand environment, companies have been focusing on enhancing utilization and shifting to a more just-in-time hiring model,” noted Nasscom.
Nasscom Chairperson Rajesh Nambiar expressed confidence in the industry’s resilience, stating, “While headwinds like global economic slowdown, inflation, recessionary fears, and geopolitical conflicts continue to pose challenges, we are confident that the industry will bounce back.”
“With digital tech spending expected to grow in 2024, we will also witness the emergence of alternative demand sources, customer retention, and faster go-to-market strategies in newer markets for enterprises,” Nambiar added.
Segments like global capability centers (GCC) and Engineering R&D emerged as growth drivers, with an expansion in the addressable market due to digital capabilities and global ER&D sourcing.
Nasscom President Debjani Ghosh emphasized the importance of capability building in FY2025, stating, “We do see FY2025 as the year of capability building as the new normal. Navigating the current challenges will require the industry to focus on 4Rs—reshape, reskill, rewire and R&D investments.”
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