Gartner: India’s IT spend to cross $176 billion in 2026; data centre systems seen rising 20.5% on AI infra push

India’s overall IT spending is expected to cross $176 billion in 2026, according to a Gartner projection cited in a report, as businesses continue to allocate budgets toward computing, infrastructure and digital transformation. Within that headline figure, data centre systems are projected to be the fastest-growing segment, with spending forecast to rise 20.5% in 2026 to $9.38 billion, following a sharp increase in 2025. ([moneycontrol.com](https://www.moneycontrol.com/artificial-intelligence/data-centre-spending-to-jump-20-5-in-2026-as-india-it-spend-crosses-176-bn-says-gartner-article-13684400.html?utm_source=openai))

The report attributes the strongest momentum to AI infrastructure—investments needed to support model training, inferencing and other data-intensive workloads. In plain terms, as companies move from AI pilots to production, they need more capacity: GPUs, storage, networking and reliable data centre systems that can run large-scale workloads without interruptions. That infrastructure demand is increasingly becoming a core driver of technology budgets, not a niche line item. ([moneycontrol.com](https://www.moneycontrol.com/artificial-intelligence/data-centre-spending-to-jump-20-5-in-2026-as-india-it-spend-crosses-176-bn-says-gartner-article-13684400.html?utm_source=openai))

The report also points to government programmes aimed at strengthening the domestic AI ecosystem as a factor shaping investment direction. It references the IndiaAI Mission, described as having an outlay of over Rs 10,000 crore, including efforts such as building GPU capacity and supporting sovereign large language models and data labs. Alongside this, evolving expectations around data privacy and sovereign cloud are influencing how organisations plan infrastructure, especially for sensitive sectors. ([moneycontrol.com](https://www.moneycontrol.com/artificial-intelligence/data-centre-spending-to-jump-20-5-in-2026-as-india-it-spend-crosses-176-bn-says-gartner-article-13684400.html?utm_source=openai))

For India’s tech ecosystem, the implication is that the next wave of growth is as much about “boring” infrastructure as it is about flashy apps: data centres, power, cooling, connectivity and compliance-ready cloud setups. The AI boom, in other words, is turning into a very real, very physical buildout—one likely to ripple through hardware suppliers, cloud providers, colocation players and enterprise IT teams across 2026. ([moneycontrol.com](https://www.moneycontrol.com/artificial-intelligence/data-centre-spending-to-jump-20-5-in-2026-as-india-it-spend-crosses-176-bn-says-gartner-article-13684400.html?utm_source=openai))

• Gartner projection: India IT spend to cross $176 billion in 2026
• Fastest-growing segment: data centre systems
• Forecast: data centre systems spend up 20.5% in 2026 to $9.38 billion
• Primary driver: AI infrastructure demand and sovereign cloud/data privacy needs

What to watch: If demand continues at this pace, constraints may shift from budgets to execution—availability of reliable power, hardware supply, skilled operators and the speed at which compliant infrastructure can be rolled out. Those bottlenecks will influence how quickly Indian organisations can scale AI from ambition to production results. ([moneycontrol.com](https://www.moneycontrol.com/artificial-intelligence/data-centre-spending-to-jump-20-5-in-2026-as-india-it-spend-crosses-176-bn-says-gartner-article-13684400.html?utm_source=openai))