End-user spending on public cloud services in India is forecast to grow 28.1% to total $17.5 billion in 2026, up from $13.7 billion in 2025, according to Gartner, Inc, a business and technology insights company.
“Strong enterprise demand for AI-ready cloud infrastructure is redefining cloud investment priorities in India, driving the next phase of public cloud spending growth,” said Ashish Banerjee, Sr Principal Analyst at Gartner. “This is further fueled by rising demand for application modernization, digital sovereignty, digital service delivery and more scalable, consumption-based IT models, as organizations move toward more advanced and strategic cloud use cases.”
“Cloud adoption is becoming more tightly aligned with business goals, such as improving productivity, accelerating innovation and go-to-market speed, enhancing customer experience and strengthening business resilience,” said Banerjee. “This sharper focus on business outcomes is sustaining strong momentum in cloud investments across the country.”
Gartner analysts are exploring how IT infrastructure and operations (I&O) leaders can advance their cloud strategies and optimize costs at the Gartner IT Infrastructure, Operations & Cloud Strategies Conference in Mumbai this week.
Infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) are expected to be the fastest-growing segments in India’s cloud market, with IaaS projected to grow 40% in 2026, followed by PaaS at 25.4%
Table 1. India Public Cloud Services End-User Spending Forecast (Millions of U.S. Dollars)
“The rising need for AI-ready infrastructure, including GPUs, high-performance compute, high-speed networking, scalable storage and always-on inference capacity, is amplifying IaaS adoption and driving higher spending in this segment,” said Banerjee.
PaaS is the largest spending category for Indian organizations in 2026, and is forecast to reach $6.4 billion, as enterprises rebuild their technology foundations to support AI-driven initiatives.
“Organizations are accelerating adoption of AI-driven technologies to unify data, connect systems, speed up development and enable real-time digital interactions, driving PaaS growth beyond cloud migration toward platform-led execution,” said Arunasree Cheparthi, Sr Principal Analyst at Gartner.
SaaS is expected to exhibit more moderate growth in 2026. “This reflects its established adoption base, as enterprises optimize licenses, rationalize usage and shift incremental spending toward infrastructure and platform capabilities required to scale workloads and operationalize AI at scale,” said Cheparthi.
Cloud Priorities in 2026 and Beyond
Governance of increasingly complex hybrid, multicloud and AI-enabled environments is emerging as one of the most significant cloud challenges for enterprises in 2026.
Gartner predicts that by 2030, over 60% of enterprises will perform intensive AI model activity in one cloud but leverage it with their data in another, up from less than 10% today
“Over the next 12-18 months, I&O leaders in India need to shift from cloud adoption to disciplined execution,” said Banerjee. “This includes prioritizing AI-ready data and infrastructure, stronger governance, FinOps maturity, security-by-design and dynamic workload placement across hybrid and multicloud environments.”
“Organizations that can scale AI and digital initiatives while demonstrating business value, maintaining cost and risk discipline, and addressing critical skills gaps without slowing innovation, are expected to outperform their peers.”
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