3 Key Drivers of Cloud Adoption and Socioeconomic Growth in India

Dilip Khandelwal
Jun 27 · 4 min read

Cloud computing has revolutionized the way how technology becomes accessible for everyone. It offers a faster and more efficient way to run and adapt business operations to changing market environments. It simplifies the consumerization of technology. It has unleashed unprecedented possibilities to create highly engaging customer experiences. For many, the cloud has become omnipresent at work and at home.

Cloud computing is one of the top technologies of our time that will shape the future of generations to come. That is particularly true for India. According to a recent NASSCOM report, the cloud is one of the key drivers for socioeconomic growth in India.

The Indian cloud computing market reached US$ 2.5 billion in 2018. While cloud adoption and IT spend in India are still at a nascent stage, and lagging behind the global average, there is a significant potential for growth. Industry analysts estimate that India’s cloud market will pass US$ 7 billion by 2022 with a compound annual growth rate of 30 percent. The largest cloud computing segments are software-as-a-service (SaaS) and infrastructure-as-a-Service (IaaS).

The NASSCOM report identified ten key growth drivers and trends for cloud growth: the consumerization of IT, an increased awareness of cloud computing benefits, a growing worldwide cloud market, a diverse landscape of suppliers, higher availability of skilled talent, new requirements of agile IT thinking, cost advantages, government initiatives in support of cloud computing, the proliferation of start-up ecosystem, and the rise of emerging technologies.

Out of these ten trends, I’d like to highlight three: emerging technologies, notably artificial intelligence, IT talent, and the startup ecosystem. These three trends are the foundation to accelerate socioeconomic development in India with the cloud.

Let’s take a look at all three of them.

Rise of Artificial Intelligence

The rise of emerging technologies, especially machine learning and artificial intelligence (AI) enable cloud growth, according to the NASSCOM report. In fact, cloud computing is the underlying force that empowers companies to tap into AI capabilities. Using the cloud, companies can collect, store, process, and analyze the massive data volumes that are needed for AI tools and applications. They are able to train and execute algorithms at a large scale. As a result, they can predict trends more accurately and use the data insights to transform themselves into a more intelligent enterprise. As such, the growth of AI and cloud computing are interdependent. Moreover, the symbiotic relationship between AI and the cloud can push innovation to unprecedented levels. We see more and more applications of AI for sustainable development, including monitoring water pipes and access to clean water.

Startup Ecosystem

India is the 3rd largest startup ecosystem globally. It is a maturing ecosystem that boasts a plethora of investors, investment models, incubators and accelerator programs, often in partnership with large corporations. Key growth areas include enterprise software, AI, Internet of Things (IoT), health tech, fintech, e-commerce and ed tech. Startups providing cloud services are part of the growing ecosystem. More importantly, startups across all vertical industries are also consumers of cloud services. They use cloud computing as part of their business model and strategy from day one. These cloud-natives are driving the cloud adoption in India, and globally. This includes social enterprise startups that use technology to create social impact.

Availability of IT Talent

The abundance of IT talent is one of the strongest advantages and biggest opportunities for India to rise up in the global cloud adoption ranking. Moving to the cloud, and digital transformation overall, requires access to skilled talent with technical and industry expertise. As one of the largest IT talent pools, India is expanding its IT skill set programs for IoT, analytics, cloud, machine learning and AI.

Currently, most of the IT talent in India is located in tier 1 cities, including Mumbai, Pune, Chennai, Delhi, Bangalore, and Hyderabad. To truly capture the socioeconomic growth opportunities from the cloud computing industry, we need to expand IT skill set building in tier 2 and tier 3 cities and bring technology education to rural areas. That’s why SAP Labs India partnered with the Indian government on educational initiatives that teach IT skills to India’s youth with a focus on cloud, data science, and machine learning. We are part of the “Yuva Yuga” program of the Department of Information Technology, Biotechnology and Science &Technology (ITBT) of the Government of Karnataka that gives underprivileged youth access to technology skills training. As part of our partnership with NITI Aayog, we adopted 100 Atal Tinkering Laboratories (ATL) that teach programming, robotics, and data visualization and other STEM skills to secondary school children across India. Our Rural Digital Skills Development Initiative in Rajasthan is training and upskilling people in rural areas for entry-level jobs in the IT industry. We need to bring IT education to all corners of the country to fully leverage the cloud as a growth driver for socioeconomic opportunities for all.

The next phase of India’s cloud computing industry has all the potential to drive socioeconomic growth across India, beyond the tier 1 cities. With the proliferation of intelligent technologies, IT skill set trainings and new innovation models we can accelerate the cloud adoption rate in India and globally. It is an opportunity to further strengthen India’s position as a global innovation hub.

SAP Innovation Spotlight

Brand journalists cover tech and IT trends like Digital Transformation, Future of Work, Purpose, Customer Experience, and more. VISIT OUR ARCHIVES HERE: https://medium.com/sap-innovation-spotlight/archive.

Dilip Khandelwal

Written by

Managing Director of SAP Labs India. Entrepreneurial thinker. Startup mentor. NASSCOM Executive Council Member.

SAP Innovation Spotlight

Brand journalists cover tech and IT trends like Digital Transformation, Future of Work, Purpose, Customer Experience, and more. VISIT OUR ARCHIVES HERE: https://medium.com/sap-innovation-spotlight/archive.

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