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Tech Industry

Small Indian firms buying their first computers

Holding "the key to growth in India," according to a market analyst, nearly 22 percent of small companies plan to pick up their first PCs in 2009.

More than half a million of India's small businesses that have never owned PCs before will acquire their first computers this year, according to a new study released Monday.

According to Access Markets International Partners (AMI-Partners), nearly 22 percent of small businesses, or companies with up to 99 employees, in India have plans to invest in computers for the first time over the next 12 months.

While buying their first PCs, these small businesses will also boost spending in other IT sectors in India, such as software, services, and security, the research house said.

Dipendra Mitra, an analyst at AMI-Partners, said small businesses in India that already own PCs will extend the lives of their existing personal systems as they try to cut costs during the economic downturn.

As such, "non-PC-owning businesses hold the key to growth in India," Mitra said in a statement. "Even if a fraction of the 2.5 million non-PC-owning businesses buy a PC, it will provide a considerable boost to the Indian IT industry."

Although small and midsize businesses are a vital part of India's economy and a major contributor to its gross domestic product, only a little more than a third of all small businesses actually own a PC, AMI-Partners noted. A reason for this is their lack of awareness of the benefits PCs can provide, the research firm said.

A separate AMI-Partners survey found that more than 55 percent of small businesses see PCs as having no relevance to their business, and nearly a third have not even considered buying one.

However, Mitra said, this attitude is changing.

"About a quarter of non-PC (small businesses) say PCs will make their business look more professional," he said. "One-fifth of these non-PC SBs say PCs will increase the productivity of their employees, and the resultant business automation will boost efficiency."

Sol E. Solomon of ZDNet Asia reported from Singapore.