The Indian government will spend $7.2bn on IT in 2015, with IT and business processing outsourcing (BPO) services the biggest area of investment, according to research firm Gartner.
In total, spending by state and regional government, as well as central government agencies, will be 5% higher in 2015 compared with 2014.
Gartner takes into account internal IT spending, which includes wages and benefits for IT staff, hardware, software, external IT services and telecommunications.
IT services and BPO will both see double-digit growth in 2015 and will be the largest overall government IT spending category through 2018, said Gartner.
Research director at Gartner Anurag Gupta said the BPO segment will grow by 22% in 2014.
“IT services are expected to grow by 10.9% in 2014 to reach $1.8bn in 2015, up from $1.6bn in 2014," he explained.
More on IT in India
IT service providers based in India have seen huge growth through servicing Western businesses and have recently increased their focus on the Indian government sector. For example, Tata Consultancy Services (TCS) has transformed the Indian government’s passport service.
In 2013, president at ISG for the Asia-Pacific region Sid Pai said: "Indian IT services firms are now not only supplying Indian businesses, but the government as well."
The cost of IT staff will increase by 9.9% in 2014, while the software market will grow from $788m in 2014 to $910m in 2015.
“India has a new government in power with the underlying promise of less government and more governance. The delivery of a citizen-centric and transparent government is only possible through the extensive use of technology and by leveraging digital government,” said Gupta.
“We expect a focus on expanding broadband penetration, accelerating digitization of core government processes, leveraging mobility to engage the citizens, cloud initiatives and public-private partnership. India has ambitious plans to build several smart cities and this will create new opportunities,” he added.