India Continues To Be The Preferred Digital Services Destination Globally: Report
A report on Monday revealed India continues to be the preferred outsourcing destination for businesses aiming to build and expand their digital services portfolio.
The Nasscom report in collaboration with Avasan said with over 50 per cent of Indian companies in the travel and transportation, telecom, media and entertainment, and construction and engineering sectors digital medium emerged as popular outsourcing needs.
The study highlighted that about 71 per cent of surveyed enterprises have spent over 20 per cent of their technology expenditures toward digital initiatives in CY2023 and between 47 per cent and 49 per cent of firms in sectors like telecom, media and entertainment, discrete manufacturing, and energy and utilities outsourced digital services work to their own capability centers in India.
Additionally, nearshoring trends in the nation were also found to be notable, with 45 per cent of high-tech and travel and transportation companies, alongside 41 per cent to 43 per cent of telecom, discrete manufacturing, and construction firms, opting to nearshore to India in 2023, underscoring the country's growing appeal as a global hub for digital services outsourcing.
The study mentioned nearly 90 per cent of the surveyed companies plan to boost their investments in key digital technology areas, including artificial intelligence (AI) and machine learning (ML), big data analytics, cloud computing, cybersecurity, and intelligent automation in 2024.
It suggested that the adoption of Generative AI is set to expand significantly and is anticipated to shift more toward cybersecurity in the next 18 months, by H1CY2025.
Furthermore, the study discovered that Gen AI has emerged as a prominent technology in 2023, attracting targeted investment from nearly 70 per cent of global enterprises.
In a statement, Sangeeta Gupta, Sr Vice President and Chief Strategy Officer at Nasscom said, "Prioritsing the development of digital talent within organisations is essential to ensure the workforce can effectively leverage AI and other advanced technologies. Moreover, focusing on data mastery to extract actionable insights and informed decision-making is critical.”
Shedding light on the 2024 outlook the survey said 68 per cent of global enterprises anticipate an uptick in client demand, while 80 per cent expect revenues to either maintain current levels or increase, even amid pricing pressures.
Moreover, the study predicted a strategic pivot toward competitive differentiation is projected to be the primary business focus in 2024, superseding the cost management emphasis of 2023. Investment hotspots over the next 12 to 18 months include cybersecurity, AI, ML, Gen AI, networking technology, and automation, largely fueled by the imperative to leverage data more effectively.
