'Govt IT spending to total $7.8b this year'

The government is expected to spend $7.8 billion on IT in 2017, a 7.5% increase over 2016, according to Gartner.

This is lower than Gartner’s previous projection of 9.5% growth this year.

“The 2% revision in our outlook is primarily due to the effects of demonetisation and a drop in industrial production,” Moutusi Sau, principal research analyst at Gartner, said in a statement.

“However, spending plans like affordable housing scheme and increased loans to small and medium enterprises by the government are likely to have a positive effect on IT spending in the next few quarters,” he added.

IT services, which includes consulting, software support, business process outsourcing, IT outsourcing, implementation and hardware support, is expected to grow 10.8% in 2017 to reach $2 billion, making it the largest infotech spending category.

The software segment includes enterprise resource planning (ERP), supply chain management (SCM), customer relationship management (CRM), desktop, infrastructure, vertical specific software and other application tools. The software segment is expected to grow 10.8% in 2017 to reach $1.1 billion.

ERP/SCM/CRM will be the fastest growing segment with 14.5% growth in this category, it added.

Devices are expected to grow 10.4 per cent in 2017 to reach USD 1.1 billion, Gartner said.