India’s IT sector is expected to grow in the high single digits in the ongoing fiscal and the next, even as AI threatens to structurally rework the industry itself.
Revenue of the IT services industry is likely to grow at 6.1% year-on-year to $315 billion in 2025-26, with a similar quantum of growth expected next fiscal, industry body Nasscom said on Tuesday. That growth will be driven by AI-led services as well as business at global capability centres. In FY24, the sector delivered a top line of $297 billion as against $283 billion estimated earlier.
The IT services industry is facing a double whammy of sorts, that of tepid demand and threats of disruption from AI tools. A selloff in Indian IT stocks has wiped out out nearly $50 billion in market capitalisation.
However, Tata Consultancy Services Ltd., Infosys Ltd. and HCLTech have signaled better demand for FY27, stemming from strong contract bookings and return of discretionary spending.
IT Jobs
Additionally, the industry is expected to add 135,000 jobs on a net basis, taking the total headcount to 5.95 million in FY26, Nasscom said. That compares with 5.8 million in FY25 and 5.67 million in FY24.
“There is no question that the overall hiring from the campus has come down significantly from where it used to be,” Nasscom President Rajesh Nambiar said.