Indian public cloud market set to hit over $25bn by 2028

The Indian public cloud services market is set to grow to $25.5bn by 2028, with a compound annual growth rate of 24.3% over the next three years, according to latest research by IDC.

Fuelling this growth are key drivers such as the growing pace of digital transformation, a preference for as-a-service consumption models to optimise costs, and the burgeoning adoption of generative artificial intelligence (GenAI), according to the research firm.

The first half of 2024 saw the Indian public cloud services market, which comprises infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS), generate $5.2bn in revenue. This momentum is expected to continue as enterprises increasingly migrate mission-critical workloads to the cloud.

GenAI has also played a pivotal role, with public cloud emerging as the preferred deployment environment for these workloads, making cloud providers strategic partners for Indian businesses that are implementing GenAI applications.

In the first half of 2024, the top five cloud providers accounted for over half of the market share. SaaS maintained its position as the dominant deployment category, followed by IaaS and PaaS.

Significant growth was also observed in specialised cloud segments such as AI platforms and application development software, alongside ongoing demand for established enterprise applications such as customer relationship management, enterprise resource management and collaboration.

The trend towards multicloud adoption is gaining traction as well. As applications are modernised on public cloud platforms, Indian organisations are increasingly embracing multicloud architectures to enhance infrastructure efficiency and optimise costs, said Rajiv Ranjan, associate research director for cloud and AI at IDC India.

At the same time, AI tools are being used to streamline cloud operations, bolster security, develop innovative products and services, and improve customer experiences. Public cloud adoption is also expanding beyond cloud regions to edge locations, he added.

India’s growth trajectory mirrors global cloud trends and is further underscored by investments from major technology players. For example, companies such as Qlik are expanding their cloud footprint in Asia, including a new cloud region in Mumbai to cater to growing demand for data-driven decision-making capabilities.

Other major cloud providers such as Amazon Web Services and Google are also making significant investments in the subcontinent, including establishing new datacentres and expanding their service offerings. These investments signal a strong commitment to the Indian market and further contribute to the growth of the cloud ecosystem.

Furthermore, examples such as Manipal Hospitals showcase how cloud technology is transforming specific sectors in India. Manipal worked with Google Cloud to implement a mobile app for automating nurse rostering and explore the use of AI-powered tools to enhance patient care and streamline operations.