Indian government to spend Rs 36,800 crore on IT in 2013

The union government will spend Rs36,800 crore on IT products and services in 2013 - a 10.5 per cent rise from Rs33,300 crore spent a year ago, with telecommunications, remaining the largest overall spending category within the government sector.

This forecast includes spending by government organisations on internal IT (including personnel), hardware, software, external IT services and telecommunications, a study by research and analyst firm Gartner said.

Telecommunications, which includes telecommunications and networking equipment and services, is expected to grow 6.8 per cent in 2013 to reach Rs11,800 crore in 2013, up from Rs11,100 crore in 2012. Most of this growth will be in enterprise network equipment, it said, adding, software is achieving the highest growth rate amongst the top level IT spending categories – forecast to be 18 per cent in 2013, led by investments in desktop software and infrastructure software.

The IT industry is expected to indirectly benefit from government projects such as the Unique Identification Authority of India (UIDAI), which will 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.

''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.

''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 and encouraging micro ATMs.

To expand the benefits of IT, GoI aims to invest more than Rs20,000 crore in expanding broadband penetration. The electronic chip-making project, digitisation of academic databases across all educational institutions, vehicle registrations, driving license databases etc will be the major focus areas,'' Gupta added.