GROWTH OF CONSULTANCY IN INDIA
As the Indian economy strives to achieve its vision of $5 trillion GDP by 2022, all the sectors are expected to experience unprecedented growth. The consulting industry reached $11.5 billion by the end of 2017, averaging an annual increase of just 7% from 2013. Since then, the industry has been compounding a whopping 30% annual growth rate and is set to become a $3.8 billion industry by the end of 2020.
Let us try to understand the reasons for such tremendous growth of the consulting industry in India as well as the challenges it will face in the next few years to come.
Reasons for the growth of consultancy in India
- Relaxation in FDI restrictions: The reduction in foreign direct investment restrictions and improved structuring of tax laws helped attract investment from international players to India. This, in turn, created a higher demand for consultancy services to understand India’s market.
- Increasing Industrialization: Heavy investment of the government and private players in the petrochemical, power, and metallurgical industries creates a demand for consultancy services to provide adequate knowledge for the smooth establishment and operations of such sectors.
- Growth of IT sector: The rapid growth in the industry of information technology creates a massive demand for IT consultants with a good grasp of the latest technologies. Increasing digitization requires businesses to adapt to the digital market for long-term growth. IT consultants provide companies with digital solutions in the form of software, applications, web solutions, and cybersecurity.
- Government Initiatives: The initiatives of the government for economic growth and sustainability such as smart city projects, greenfield projects, and several such initiatives calls for strategy and operations consulting services for smooth launching and progress of these initiatives.
- Increasing startup culture: Shift in the mindset of the youth from being a job seeker to an entrepreneur has created a growing startup culture in the economy. This creates a demand for all kinds of consultancy services like strategy, management, operations, and IT to understand the market and its needs and provide efficient solutions to fulfil those needs.
Challenges to the Indian consulting industry
- The most prominent challenge for the Indian consulting organizations is the competition from the global players in the market.
- With increasing digital transformation and businesses switching to robotics, AI, and ML technologies, the consulting companies face the challenge of training their workforce to provide quick, smart, and profitable solutions to their clients.
With over 8000 organizations, the Indian consulting industry is one of the fastest-growing sectors in India. The industry is growing at a steady rate and is creating more than 2.2 lakh jobs per year. Consulting jobs are highly demanded these days owing to the plenty of growth opportunities they provide, besides a good pay.Share with your friends