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Saurabh Daga, Technology Analyst at GlobalData, says: “The uncertainty seen in business environment over the last two years caused by the COVID-19 pandemic seems to be now giving way to signs of renewed period of growth, and driving positive enterprise investment sentiment for various IT solutions, including storage. Against this backdrop enterprise spending on storage infrastructure is expected to reach US$3.7bn in 2025.”

Enterprises in India are increasingly aware of the benefits that digital transformation brings vis-à-vis operational improvement as well as customer experience. Implementation of Internet of Things (IoT), application-based service delivery, and mobile-first strategies have led to a massive surge in data, which needs to be efficiently managed and backed-up, thus driving the enterprise storage spending.

Several Indian enterprises are upgrading their legacy storage infrastructure with storage solutions, which will also drive market growth. For instance, state-owned Indian Bank upgraded its IT infrastructure following its merger with Allahabad Bank, which included the shift of the bank’s core workloads to storage powered by IBM power9 processors.

In October 2021 India’s private sector financial services provider South Indian Bank issued a request for proposal for a centralized on-premise storage solution with a mix of storage area network (SAN) based-hardware and different software-defined storage mechanisms for replication, and capable of supporting Microsoft SQL, MYSQL, DB2 databases.

Among storage infrastructure segments, storage hardware will be the largest segment in terms of revenue opportunity 2021. Hardware segment will be followed by services and software segments in that order. Hardware segment will also be the fastest growing category, with its market value to register a CAGR of 12.2% over 2020-2025.

Daga adds: “Growth in the hardware segment is primarily driven by high performance storage requirements for managing next-generation workloads and running mission critical applications. Indian Enterprises, especially in banking and government sectors, are undergoing an overhaul of their existing IT infrastructure, thus boosting the demand for storage hardware, which along with servers often form the backbone of an enterprises’ IT landscape.”

Furthermore, leading storage vendors are trying to set up manufacturing in India to serve the Indian enterprises, partly due to the government-backed indigenous manufacturing promotion schemes. In October 2021, storage vendor DirectData Networks (DDN) announced local manufacturing of EXAScaler HPC & A3I (Accelerated, Any-Scale AI) Storage Appliances, SAN, NAS and Unified Storage Appliances.

Daga concludes: “While large (1,001+ employees) enterprises will account for the largest share of the total enterprise storage spending in India through the forecast period, the spending from micro, small and medium enterprises (1-1,000 employees) will increase at a marginally faster CAGR of 10.3% over the forecast period. The growth in SME sector will in part be driven by government-backed digitalization programs such as Digital India, India Stack, and Digital MSME scheme among others.”