India’s Tech Sector Poised for Stronger Growth in FY25, to Surpass $300 Billion by FY26: Nasscom

Highlights:

• Nasscom forecasts India’s tech sector revenue to grow 5.1% to $282.6 billion in FY25, surpassing $300 billion in FY26.
• Software exports expected to rise 4.6% to $224.4 billion in FY25.
• The industry to add 126,000 net new jobs, pushing total workforce to 5.8 million.
• Growth driven by increased AI adoption, expansion of Global Capability Centers (GCCs), and Engineering R&D.
• IT majors like TCS, Infosys, and HCLTech signal early signs of recovery in discretionary spending.

India’s Tech Industry on a Steady Growth Trajectory

India’s technology sector is set to experience accelerated growth in FY25, with revenues projected to rise by 5.1% to $282.6 billion, according to the National Association of Software and Service Companies (Nasscom). The sector, which saw 4% growth in FY24, is expected to cross the $300 billion milestone by FY26.

A major contributor to this growth is the expansion of Global Capability Centers (GCCs) and the rising prominence of Engineering Research & Development (ER&D).

Software Exports and Job Growth Outlook

• Software exports, including IT services and product sales, are set to increase by 4.6% to $224.4 billion in FY25.
• The Indian tech sector will see a net addition of 126,000 jobs, bringing the total workforce to 5.8 million by the end of FY25.
• In FY24, total employment in the industry grew to 5.67 million from 5.58 million.

AI and GCCs Reshaping the Industry

The adoption of Artificial Intelligence (AI) is playing a pivotal role in transforming India’s IT sector. The rise of Agentic AI, which enables autonomous task execution through AI agents, is reshaping traditional business models.

According to Sindhu Gangadharan, Chairperson of Nasscom, factors such as:

• Enhanced AI implementation,
• The evolution of GCCs into high-value innovation hubs, and
• Growing focus on digital trust and resilience
  are driving sustainable industry growth.

IT Giants Witness Recovery in Client Spending

Leading IT service providers such as Tata Consultancy Services (TCS), Infosys, and HCLTech have indicated early signs of revival in discretionary spending, following a challenging 2024 where global clients delayed decision-making and cut budgets.

While AI advancements pose potential disruption to traditional IT service models, Indian IT firms are adapting by integrating AI-powered solutions into their service offerings.

Technology, Geopolitics, and Future Industry Challenges

Nasscom emphasizes that the intersection of technology, geopolitics, and trade policies demands a proactive approach from enterprises. Workforce transformation, digital trust, and resilience-building will be key to long-term sustainability.

With AI-driven innovations, increasing global outsourcing, and expanding GCC operations, India’s IT sector is on track for steady long-term growth, reinforcing its position as a global technology powerhouse.