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Tech firms bullish on 2005 as outsourcing row wanes
Experts are unanimous that 2005 will bring in more cheer and less gloom as tech spends in India and world over rise rapidly.
India's booming information and communications technology (ICT) sector began 2004 on a cautious note with simmering outsourcing backlash and concerns over creaky infrastructure threatening to derail the growth pace.
But as the high profile sector logs out of the year, analysts and industry experts are unanimous that 2005 will bring in more cheer and less gloom as technology spends both within the country and outside rise rapidly.
With the protest in the West against the shipping of tech jobs to low cost economies on a waning path, more number of local companies are likely to reap the benefits of providing services to overseas clients, say experts.
Along with the boom in outsourcing business, the domestic telecom market is also set to witness blistering growth, especially in the mobile segment, in 2005 as falling prices add more people into the hi-tech communications loop.
India Inc is likely to increase its spending on information and communications technology (ICT) by over 16 per cent in 2005 to $22.88 billion, says an industry research firm.
India, Asia's fourth-largest economy, will remain among the biggest growth markets for the telecom sector in 2005 with an addition of 35 million new subscribers - a growth of 18 per cent over 2004, according to Gartner.
"Enterprise spending on ICT in India is expected to grow at 16.6 per cent to $22.88 billion as compared to Asia Pacific growth at 7.6 per cent in 2005," said vice-president and research director of Gartner India, Sujay Chohan.
"For vendors the stakes couldn't be higher. Vendors, who have long ignored the local market, cannot afford to miss this transition," Chohan added.
Of the $22.88 billion estimated spending in 2005, $3.34 billion is likely to be incurred on hardware, representing an increase of 21.1 per cent over 2004, $16.7 billion on telecom and $2.32 billion on IT services, experts said.
According to Gartner, projected users of telecom services in India will account for almost one fourth of the new subscribers forecasted in Asia Pacific.
