The Indian IT market is expected to grow by 18 per cent in the year 2008 to reach $38 billion, clocking second highest growth rate after China's which is likely to attain a 20 per cent growth and touch $138 billion in size, as per the latest research data released by Forrester.
The report by the reseach firm calls this double-digit growth as a welcome news for technology vendors - who see slackness in the US and European markets, and advises them to now recognise India as a consumer of IT than just a supplier.
The report -- the State Of A-PAC Enterprise Technology Adoption: 2008, gives highlights of data collected from 777 companies in the Asia Pacific region via Forrester's Enterprise Technology Adoption Survery (Asia Pacific, Q4 2007).
These 777 companies were of the 1000-plus employee size from countries such as Australia, New Zealand, India, Korea, Singapore, Japan and China.
Forrester's Sr Analyst -- Jonathan Brown, who authored the report, said: "the IT sector has long looked to India for top-drawer technology talent.But India is poised to become an increasingly important market for technology vendors as its population comes of age (half of India's population today is under 20), its rural areas become increasingly developed, and its engagement with the US increases".
"It's time the tech vendors no longer treat India as merely a skilled talent pool but also as a lucrative market in its own right", he said.
Citing the report data on India's most promising opportunities, Brown said: "Indian firms will make the greatest leaps in application integration, ERP, CRM, unified communication, and security and regulatory compliance. In addition, India's cultural diversity, fragmented state goverments and socio-economic disparities make it a mocrocosm of the broader APAC region."
"I expect smart vendors will use India as a testing ground for new business models and strategies to try out models for the next wave of emerging economies", he said.
The report states that though Asia Pacific economies are closely connected to each other through trade and cross investment, they differ enormously in their levels of economic development and the states of their IT infrastructure.
Brown advised technology vendors to tap Japan for services rather than software and be cautious in Chinese market and asked them to first determine 'what IT will not do with as much clarity as they describe what IT will do while in China.'