India's Tech Industry Poised for Robust Growth to $315 Billion in FY26
Navigating twin disruptions—intensifying geopolitical uncertainty and the rapid rise of AI-native competitors—India's technology industry is leaning on its core strengths of scale, engineering depth, and delivery resilience. According to Nasscom, despite AI-led disruptions that have rattled stock prices, the sector is on track to grow 6.1% to $315 billion in the fiscal year 2026.
Steady Demand and Diversified Revenue Mix
This growth reflects steady demand across various segments, even as enterprises recalibrate their spending priorities. The revenue mix for 2026 underscores the industry's diversified base, with IT services leading at $149 billion, followed by BPM at $59 billion, ER&D (engineering research and development) at $63 billion, software products at $23 billion, and hardware at $21 billion.
Indian IT exports are projected to rise 5.6% year-on-year to $246 billion in FY26, up from $233 billion in FY25, highlighting the sector's global competitiveness.
Structural Transition and AI Integration
Nasscom president Rajesh Nambiar described FY25 and FY26 as a structural transition phase for the industry. While 2025 was marked by global economic caution and geopolitical shifts, he noted that technology spending was not cut—it was redirected. Enterprises prioritized resilience, productivity, and AI-led transformation over discretionary expansion.
AI has moved from experimentation to execution, with industry AI revenue estimated at $10-$12 billion in FY26, contributing roughly 3-4% of overall industry revenue, and up to 5-6% for some companies. "AI is embedded in most enterprise proposals today," Nambiar stated at the Nasscom Technology Leadership Forum (NTLF) 2026 in Mumbai.
Adoption of AI Capabilities
The adoption of AI is accelerating, with around 70% of the top 25 providers acquiring AI-native capabilities, 85% now having agent platforms, and 35%-40% offering verticalized AI solutions. This shift underscores how Indian tech firms are leveraging AI to enhance their offerings and stay competitive in a rapidly evolving landscape.
Overall, India's technology sector continues to demonstrate resilience and adaptability, positioning itself for sustained growth despite ongoing challenges.
