Indian government to spend 368bn rupees in 2013 to improve IT

The total spend marks a 10.5% increase over the government’s 2012 spend, the research firm added.

The largest spending category will be telecommunications, which includes telecommunications and networking equipment and services. It is expected to grow 6.8% in 2013 to reach 118bn rupees in 2013, up from 111bn in 2012. A majority of this growth will be in the enterprise network equipment space.

The government’s software spend is also rising sharply and is forecast to be 18% of the total budget in 2013, led by investments in desktop software and infrastructure software.

GoI could invest more than INR 20,000-crore rupees in expanding broadband penetration. The electronic chip making project, digitisation of academic databases across all educational institutions, vehicle registrations, driving license databases etc will also be other major focus areas.

“The Indian government is starting to leverage UID identities to authenticate citizens for transferring welfare benefits directly to the recipient’s bank accounts, in the form of cash transfers, thereby creating a new system for welfare benefits,” said Anurag Gupta, research director at Gartner.

The research firm predicted that the IT industry could indirectly benefit from Indian government projects such as the Unique Identification Authority of India (UIDAI), which aims to create an online database with biometric and identity details of Indian residents; the launch of the National Optical Fibre Network and the computerisation of commercial taxes in states.

“India goes to the national polls in 2014, and the GoI will aim to expand the UID operational infrastructure by speed tracking ‘financial inclusion’, allowing easy access to banking for poor & encouraging micro ATMs,” Gupta added.