Indian tech industry grows 3.8 pc at $254 billion in FY24, employs 5.43 million people

New Delhi, Jan 3: Despite a challenging year, the Indian technology industry, valued at $254 billion, grew by 3.8 per cent (year-on-year) in FY24, according to a report on Friday.

The tech industry employed 5.43 million professionals, with a growth rate of 1.1 per cent in FY24, focusing on Generative AI, cloud and cybersecurity skills. The expansion into tier 2 and 3 cities is seen as critical to bridging talent shortages, according to Grant Thornton Bharat’s ‘2025 Tech Trends Report’.

“As far as India is concerned, technology companies will need to navigate the business growth challenges as well as seize the new opportunities from Generative AI and new tech in 2025,” said Raja Lahiri, partner and technology industry leader, Grant Thornton Bharat. The country’s focus on GenAI and Engineering Research and Development (ER&D) services drove 7.4 per cent growth, with aerospace, defence and automotive leading digital engineering projects. Moreover, with 1,700 global capability centres (GCCs), India remains a hub for tech innovation, bolstered by investor interest and a strong start-up ecosystem, the report mentioned. “India is expected to continue to dominate the global technology services market driven by the availability of massive tech, engineering talent as well as high-quality business and digital transformation impact on global clients,” Lahri added. Despite challenges, the industry’s vast talent pool and growing adoption of generative AI, SaaS and digital transformation projects position it for a moderate recovery in 2025. According to the report, Indian companies would need to create and foster a culture of excellence in quality, innovation and customer experience to lead the world of tech in the New Year.

The Indian tech industry faced slowing revenue growth and rising employee costs in FY24, spurred by high attrition rates during the pandemic. “Firms must balance cost containment with strategic investments in innovation to navigate economic uncertainties and maintain competitiveness in the evolving tech landscape,” the report mentioned. India’s deeptech ecosystem, comprising over 3,600 start-ups, demonstrates immense potential in areas like AI, space tech, and health tech. “Strategic Gen AI deployment, encompassing use-case selection, robust governance, and operational efficiency, positions organisations to achieve long-term value creation, making AI a cornerstone of the digital transformation journey,” it added.