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India application software spending to grow 15% in 2022: Gartner

End-user spending on enterprise application software in India is forecast to total $4.7 billion in 2022, an increase of 14.8% from 2021, according to Gartner, Inc “Driven by the digital transformation agenda, Indian enterprises will continue to expand the share of software spending in their broader IT spending. Organizations are increasingly relying on software to operate all aspects of business,” said Neha Gupta, vice president analyst at Gartner.

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However, the growth in software spending will be lower in 2022 than in 2021. “The volatile global macroeconomic situation has increased business uncertainty. Organizations will continue to put new long-term projects on hold selectively and cut the scope of high-cost projects and instead look to “quick win” projects that either have a shorter return on investment (ROI) or provide a competitive edge,” said Gupta.

Applications critical for maintaining the quality of customer service, like supply chain management (SCM), supply chain execution (SCE) and customer relationship management (CRM), will see increased spending as organizations look to address complex supply chains and volatile marketplaces, and more effectively adapt to change and disruption. Spending on CRM software is forecast to grow 18.1% in 2022, while SCM software spending will increase 10.2% (see Table 1). Likewise, core financial and planning tools will see increased spending as companies look to improve their ability to manage cash and ensure a firm financial foundation upon which to grow.

Table 1: India Total Enterprise Application Software End-User Spending Forecast, 2021 – 2023 (Millions of US Dollars)

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Market2021 Spending2021 Growth (%)2022 Spending2022 Growth (%)2023 Spending2023 Growth (%)
Analytic Platforms36019.641916.549518.2
Content Services27620.031915.536614.8
Customer Experience and Relationship Management (CRM)95920.51,13218.11,34118.5
Email and Authoring56821.765916.076816.5
Enterprise Resource Planning46018.551411.656610.3
Project and Portfolio Management6515.2719.67810.2
Supply Chain Management19614.421610.224111.4
Other Application Software74614.982811.056610.3
Overall Total3,62918.64,15714.64,77414.9

Source: Gartner (August 2022)

Indian businesses will also increase spending on email and authoring and content services to continue to support collaboration and remote/hybrid work. A large portion of pandemic-related spending in these two markets occurred in 2020, causing a large peak that, while still growing, has slowed spending for the next few years. 

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