Insurance, banks, public sector drive APAC IT spend, Forrester says

Australia and Singapore defence agencies test genAI for efficiency and decisions.

Insurance, banking, and public sector organisations are expected to drive IT services spending growth across Asia-Pacific (APAC) as they step up technology modernisation to deal with tighter regulations and ageing systems. 

In Australia and Singapore, defence and public sector agencies are also starting to explore generative AI to improve operational efficiency and support decision-making, according to Forrester’s “Global IT Services Market Forecast, 2025 To 2029” report.

This demand underpins Forrester’s expectation that global IT services spending will grow at a compound annual growth rate of 4.8% from 2024 to 2029, despite ongoing economic and productivity pressures. 

Financial services firms, in particular, are increasing investment in cloud platforms, automation, and cybersecurity to manage compliance requirements and reduce technology obsolescence.

Cloud services are expected to remain the strongest growth area. Infrastructure as a Service is forecast to grow at a 21.9% CAGR through 2030, far outpacing overall software spending. 

Indian IT providers such as Tata Consultancy Services and Infosys are reporting strong demand for sovereign cloud solutions, whilst Australian enterprises are accelerating hybrid cloud adoption to meet data residency and regulatory needs.

Generative AI is also shaping the outlook for IT services adoption in the region. Goldman Sachs estimates that 10% to 20% of Chinese enterprises will adopt genAI by 2030. 

Across APAC, IT service providers are increasingly embedding AI into cloud migration, automation, cybersecurity, and compliance projects, with banks, insurers, and government agencies amongst the most active buyers.

Forrester also expects mergers, acquisitions, and regional expansion to support growth as providers scale capabilities and broaden their geographic reach. 

Accenture said almost half of its revenue growth in 2024 came from acquisitions, whilst Capgemini expanded further into Asia through its acquisition of WNS Holdings. 

Japan-based NTT DATA recorded the fastest growth amongst the top 20 global IT service providers, driven by demand for digital transformation and AI-related services.