India’s public cloud services market to grow at 24.1% CAGR during 2020-25: IDC

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BENGALURU: Revenue of India’s public cloud services market, including infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS) solutions, and software-as-a-service (SaaS), totalled $2.2 billion for the first half of calendar year 2021 (January-June), according to IDC’s Worldwide Semi-annual Public Cloud Services Tracker for 1H 2021. 

The Indian public cloud services market is expected to touch $10.8 billion by 2025, growing at a CAGR of 24.1% through 2020-25.

“Cloud continues to be the foundational pillar for innovation, collaboration, and digital transformation and is witnessing an accelerated adoption by enterprises in India. Organisations in India cite increased investment plans for cloud infrastructure and platforms in the coming 12 months to aid in faster and more effective ways of application development and access to technologies. Additionally, cloud-native services are becoming crucial for enabling new architectures and functionalities,” said Rishu Sharma, associate research director, Cloud and Artificial Intelligence, IDC India.

SaaS continued to be the largest component of the overall public cloud services market, followed by IaaS and PaaS in 1H 2021. Public cloud spending continued to increase among enterprises, with the top two service providers holding more than 49% of the Indian public cloud services market.

The covid-19 pandemic drove cloud adoption in 1H 2021, as enterprises continued their investments in cloud infrastructure, platforms, and software to improve the resiliency of their business operations. 

Apart from large enterprises, small and medium businesses also continued to witness a significant increase in public cloud adoption due to demand for cloud-based applications for collaboration, Enterprise Resource Management (ERM), Customer Relationship Management (CRM), security, etc.

“The accelerated adoption of public cloud is expected to continue in the upcoming years as enterprises expedite their digital transformation initiatives by increasingly leveraging emerging technologies, with public cloud being the bedrock, to improve business resiliency and deliver enhanced customer experience,” said Harish Krishnakumar, senior market analyst, IDC India.

“With many businesses expected to transition to a hybrid work model in the upcoming months, this would result in an increase in public cloud investments due to the demand for remote compute and storage, conferencing and collaboration applications, VDI, cloud security, etc.,” he added.

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