With the rapid digital transformation and an ever-expanding cyber threat landscape, enterprises in India are ramping up their investments in information security at an unprecedented pace. According to Gartner, Inc., end-user spending on information security in India is projected to hit $3.3 billion in 2025, marking a 16.4% increase from 2024. Among all security segments, security services is set to experience the highest growth, soaring 19% year-over-year, fueled by a pressing shortage of skilled cybersecurity professionals and the growing need for managed security solutions.
A Perfect Storm: AI, Cloud, and Ransomware Fuel Security Investments
The explosive growth in cybersecurity spending is being driven by several critical factors, including the rapid adoption of generative AI (GenAI), the increasing frequency of ransomware attacks, the evolving regulatory landscape, and the accelerating shift to cloud-based infrastructures. As organizations integrate AI into their operations, they face unprecedented security risks, such as data sprawl, privacy vulnerabilities, and the need for real-time threat detection.
“Persistent security challenges, such as data sprawl from GenAI use, ransomware attacks, evolving regulatory landscapes, and robust cloud adoption, are driving Indian enterprises to increase their information security spending across all segments in 2025,” said Shailendra Upadhyay, Senior Principal at Gartner. “These urgent challenges necessitate real-time threat detection and incident response across hybrid ecosystems.”
To address these risks, Chief Information Security Officers (CISOs) in India are shifting their security priorities. Investments in cloud security, identity and access management (IAM), and data security and privacy are at the forefront, as businesses aim to strengthen their security posture and ensure business resilience.
Security Services: The Fastest-Growing Segment in 2025
Gartner’s report highlights security services as the fastest-growing segment in India’s cybersecurity landscape, expected to grow from $1.34 billion in 2024 to $1.6 billion in 2025, marking a 19% increase. This growth is primarily being driven by the acute shortage of skilled cybersecurity professionals, forcing organizations to outsource security operations to specialized service providers.
“Organizations are increasingly using managed security functions from specialized agencies to increase focus on their own core operations,” Upadhyay noted. “The burgeoning demand for security services is further amplified by a shortage of skilled security professionals, making it challenging to secure and retain in-house expertise. Consequently, reliance on external service providers is expected to rise in 2025 and beyond, fueling the growth of the security services industry.”
Gartner predicts that by 2028, 40% of IT services contracts will include a security component, underscoring the shift toward outsourcing cybersecurity functions.
Security Software Investment Rises as Cloud Security Becomes a Priority
Alongside security services, security software spending is projected to reach $1.2 billion in 2025, driven by the increasing need to simplify security management through platform consolidation. As India’s thriving digital startup ecosystem becomes more reliant on cloud-based infrastructure, demand for cloud security solutions is set to grow significantly.
“The integration of generative AI models in enterprise applications introduces new data leakage concerns and AI application vulnerabilities,” Upadhyay warned. This has led to increased investments in security software subsegments, including application security, cloud security, data security, privacy, and infrastructure protection.
Key Cybersecurity Trends for 2025: AI-Driven Threats and Cyber Resilience
As the threat landscape evolves, CISOs in India are embracing new cybersecurity strategies to adapt to AI-driven risks and build cyber resilience.
1. AI’s Impact on Data Security
Generative AI is transforming data security programs in three major ways:
* Organizations are moving from traditional anonymization techniques to synthetic data tools for AI model training, reducing privacy risks.
* Security teams are shifting focus from structured to unstructured data security, requiring new investment in security measures.
* Companies are adopting data security posture management (DSPM) solutions to improve data cataloging, monitoring, and governance.
Gartner predicts that by 2026, 75% of organizations with GenAI initiatives will shift their spending focus from structured to unstructured data security.
2. Transitioning to Cyber Resilience
With cyber threats becoming increasingly sophisticated, security leaders are shifting their approach from prevention to resilience. Instead of assuming breaches can be completely prevented, organizations are now focusing on minimizing the impact of attacks and ensuring rapid recovery.
“To foster cyber resilience, security leaders must transition from a zero-tolerance-for-failure mindset to measuring cybersecurity success by the sustained achievement of business outcomes,” said Abhyuday Data, Director Analyst at Gartner.
Key resilience measures include:
* Cyber deterrence strategies to proactively defend systems.
* Enhanced cyberstorage capabilities to protect critical data from cyberattacks.
The Future of Cybersecurity in India
As India’s digital economy continues to expand, the need for stronger cybersecurity measures will only intensify. With increasing cloud adoption, AI integration, and regulatory oversight, enterprises will continue to invest heavily in managed security services, cloud security, and AI-driven threat detection.
The shift towards cyber resilience and AI-driven security solutions marks a new era in India’s cybersecurity strategy, where businesses must remain agile, adaptable, and proactive in the face of ever-evolving cyber risks.
With spending on security services and software poised for rapid growth, CISOs and business leaders must act now to strengthen their cybersecurity defenses and ensure business continuity in an increasingly digital world.