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IT vendors see big opportunities in Government sector


As the Indian government goes on a digital overdrive, the opportunities for IT vendors has increased tremendously.

By Ankush Kumar

The push by the Indian government to transform the country into a digital economy has created a massive opportunity for global technology companies. In addition, the recent demonetization move was a sign of the government’s confidence on technology to enable every citizen towards cashless services and digital transactions. As per the latest report by Gartner, the government in India is forecast to spend $7.8 billion US dollars on IT spending in 2017, an increase of 9.5 percent over 2016.

This clearly indicates that there will be more buying of IT related goods and services which will generate a huge interest among the top tech companies to pitch their innovative solutions for public usage. Moreover, even Ravi Shankar Prasad, Minister of Electronics and Information Technology, Government of India has mentioned that Digital India will be a $1 trillion business opportunity, combining the requirements of the telecom, IT/ITeS and electronics manufacturing sectors.

All this puts India on the radar of global tech majors as the next biggest destination for investments and growth. In the past one year, the IT industry has seen some of the biggest technology companies announcing to open their research and development centers, centers for cyber security, etc. in India. “The changes in the Indian government’s thinking are in sync with the times,” says Sanjeev Gupta, country general manager – Public Sector, Microsoft India. As the government takes most services online, from education, healthcare, public utilities, safety, etc., the clamor for efficient service delivery has been growing as people expect more seamless delivery under the digital paradigm. This has resulted in an increase for IT resources on demand.

Cloud as a catalyst for change

Government departments and government leaders are all grappling with which project is more important, and how to get the benefits of that project to citizens quickly. “For all these pieces to come together in one effective and efficient cycle, the government must embrace the power of the cloud. It can connect various departments in real time, enabling faster decision making which can lead to more efficiency in usage of resources. What’s more, it promotes ease of interaction with citizens and businesses, ultimately delivering better governance to its citizens,” explains Gupta.

As per Gartner, the public cloud services market in India is projected to grow 38 percent in 2017 to total $1.81 billion. The highest growth will continue to be driven by infrastructure as a service (IaaS) which is projected to grow at 49.2 percent in 2017, followed by 33 percent in software as a service (SaaS) and 32.1 percent in platform as a service (PaaS). The increase of SaaS and PaaS are indicators that the migration of application and workloads from on premises data centers to the cloud, as well as the development of cloud ready and cloud native applications, are fueling the growth in the cloud space.

Gupta of Microsoft believes that cloud for governance is the most cost effective way to fast forward India’s current phase of development, improve the government’s productivity and ensure fast and reliable service delivery across the country through newer and more effective delivery models.

Machine Learning and AI as future growth drivers

While cloud computing is expected to provide the backbone for technology for governments, machine learning and artificial intelligence are two areas that are future growth drivers, says    Dr Niraj Prakash, director – applications sales consulting, Oracle India. “These two sectors are going to aid the government to provide frictionless citizen services.”

The artificial intelligence (A.I.) market is estimated to grow from USD 419.7 million in 2014 to USD 5.05 billion by 2020, at a CAGR of 53.65 percent from 2015 to 2020 due to factors such as diversified application areas, improved productivity, and increased customer satisfaction.

The machine learning technology is expected to account for the largest share of the overall AI market during the forecast period. In addition, due to the increase in demand for AI from the media & advertising and finance sectors, the artificial intelligence (A.I.) market is expected to gain traction in the next five years. The machine learning technology market for the retail, healthcare, law, and oil & gas sectors is also expected to witness growth during the forecast period.

Talking about artificial intelligence and how it can help the government in creating self-service platforms for better citizen service, Prakash says, “The government’s goal is to make citizen services more seamless and intuitive, eliminate call centers and cut operational costs. As artificial intelligence and chatbots technologies evolve, the citizens will expect governments to move away from single function mobile applications and create a more intuitive communication approach. Public sector organizations are uniquely positioned to seize the opportunity and deliver on the promise for self-service. Chatbots take advantage of artificial intelligence and carry out intelligent and seamless conversations by creating a positive and responsive communication model including integration with Aadhar, wherever necessary.”

Data Storage and its reliability

Amod Ranade, general manager – data center business development at Schneider Electric emphasized on the importance of data storage with rising volumes of data that is being generated at every stage. “With adoption of IoT, smartphones and increase in Internet penetration in the country, there will be an increase in data volumes which will in turn lead to the growth of the data center industry which plays the primary role in data storage. The healthcare sector is also soon catching up as the government works towards centralizing medical data. The education sector is also getting investments and providing the students with cutting edge technology for research. We are seeing a huge demand in the HPC (high performance and computing) segment as well.”

With the government looking at new technologies, the potential remains high. Says Abhishek Sarda, GM marketing – global document outsourcing, Xerox India, “The Government will continue to embrace new technologies and service models that deliver cost effective IT faster, and smarter, while making their public processes more responsive and efficient. The government is also aiming to reinvent a de-centralized administration through speedy, correct, and truthful IT application in the Indian economy.” Sarda also opines that the government’s eMaketplace initiative is expected to bring greater transparency & efficiency in public procurement in the near future.

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