Indian management consulting market between $1.4 and $2.1 billion
According to research from two different analyst firms, the Indian management consulting segment is continuing to grow at a rapid pace, following pro-business reforms from the Modi government. The market is presently valued between $1.4 and $2.1 billion, according to the way the management consultancy industry is defined and sized.
Analysis from research firm Statista finds that the Indian management consulting market is worth up to $1.4 billion. The sector has grown by 9% over the past year, ramping up from 5%, in an increase that has been broadly attributed to Prime Minister Modi’s pro-business policies.
In the year approaching Modi’s election, rates were even higher, according to Statista, reaching 17%. The slowdown might have suggested that the market was reaching its point of maximum expansion. However, Modi’s liberalisation policies have opened up new business avenues for domestic and overseas clients, who in turn have sought external expertise in rising numbers. With Modi’s policy of privatisation continuing in earnest, analysts also expect the meteoric rise of the market to continue over the coming months, at a further 9% growth. By the end of 2017, the researchers expect that the market will be sized at $1.5 billion.
According to Source Global Research, meanwhile, 2016 was a very good year for India’s management consulting market, with 13.9% growth leading to a total market value of $2.13 billion. As India’s economy as a whole continues to witness growth that rivals that of economic superpower China, India’s management consulting sector has seen a significant increase on last year’s already-strong 11% growth.
Last year, Source reported that despite the double digit growth of 2015 seeing the market hit a value of $1.87 billion, and the expectation for the consulting segment to breach the $2 billion landmark in 2016, consultants were frustrated with the Modi government, who they perceived as acting too slowly on a host of promised reforms. While Source’s figures suggest an 11% increase in that period, it highlights industry figures had expected even better economic conditions. However, the effects of Modi’s reforms now seem to finally be kicking in, with the accelerating growth indicating a positive outlook for the coming year.
Different definitions
The differences in sizing of the market between the two firms can likely be attributed to how management consulting is defined. The segment features a cross-over in many functions from business consulting, a larger portion of which seems to have been attributed to management consulting by Source than by Statista. Growth rates also vary between the two firms, with Source data showing an unfaltering increase in growth within the industry, while Statista indicates a slowdown followed by an increase. This may relate to the varieties of activity considered by the two firms.
Further, Source typically focuses on what is known as ‘big consulting’, excluding data from firms with under 50 members of staff, and engagements under a certain value in their studies. This means growth levels are less weighted by smaller market actors, who may be struggling to establish themselves against the reputations of the likes of the consulting industry’s Big Four. Regardless of the definition, however, both analyst firms provide data which suggests India’s consulting sector can expect further healthy levels of growth over the coming years.
Related: Indian business and management consulting market picks up growth (Consultancy.in).
