India’s Research Industry – Growth and Future Prospects

India’s research industry is experiencing growth, with revenue expected to reach $3.4 billion in the fiscal year 2025. This marks a 6.25% increase from the previous year and reflects a broader trend of expansion within the sector. The Market Research Society of India (MRSI) attributes this growth to advancements in analytics and artificial intelligence (AI).

Industry Overview

The Indian research sector has shown remarkable resilience. From $2.9 billion in FY23 to $3.2 billion in FY24, the industry’s revenue has steadily climbed. The MRSI report marks the role of analytics as a key driver. Analytics accounts for 58% of the market, primarily focused on customer and marketing insights. This segment has grown by 17%, propelled by the adoption of big data and AI technologies.

Market Segmentation

The research industry can be divided into two main segments – customer analytics and custom market research. Customer analytics focuses on understanding consumer behaviour, while custom market research provides tailored insights for specific business challenges. The latter has grown by 9% and now represents 29% of the market. These trends indicate a shift towards actionable insights that address specific issues, such as rural market slowdowns and volatility.

International Influence

International clients are crucial to the industry’s success, contributing 80% of total revenues. This is driven by a growing emphasis on environmental, social, and governance (ESG) factors. Indian firms are recognised for their innovation and scalability, attracting global companies to set up captive centres in the country. This trend supports sustained growth and positions India as a leader in the research and insights market.

Employment and Talent Demand

The research sector employed approximately 145,000 professionals in FY2024. There is a rising demand for expertise in AI, machine learning, and data science. The analytics segment is particularly noted for recruiting early-career talent. As the industry evolves, it is expected to attract more skilled professionals, further enhancing its capabilities.

Future Outlook

Looking ahead, the research industry is projected to grow by 11% to 14% in FY25. This growth will be supported by advancements in AI and analytics, as well as deeper market penetration. The demand for hyper-personalised insights is expected to drive transformation within the sector. The industry’s adaptability to changing client needs will solidify India’s position as a very important market for high-quality insights.

Questions for UPSC:

1. Examine the impact of artificial intelligence on the growth of India’s research industry.
2. Critically discuss the factors contributing to the increasing demand for data science professionals in India.
3. Point out the significance of international clients in the revenue generation of India’s research sector.
4. Analyse the role of big data in shaping market research trends in India.

Answer Hints:

1. Examine the impact of artificial intelligence on the growth of India’s research industry.

1. AI enhances data analysis efficiency, leading to quicker insights and decision-making.
2. Integration of AI with traditional analytics drives innovation, improving service offerings.
3. AI encourages the development of hyper-personalised insights, catering to specific client needs.
4. Increased investment in AI technologies attracts global clients, boosting revenue.
5. AI-related skill demand is rising, contributing to job creation and professional growth in the sector.

2. Critically discuss the factors contributing to the increasing demand for data science professionals in India.

1. Rapid digital transformation across industries necessitates data-driven decision-making.
2. Growth of AI and machine learning technologies requires skilled professionals for implementation.
3. Companies seek data scientists to derive actionable insights from vast datasets.
4. The rise of analytics as a core business function fuels the need for specialized talent.
5. International clients’ focus on ESG and sustainability increases demand for data analysis expertise.

3. Point out the significance of international clients in the revenue generation of India’s research sector.

1. International clients contribute 80% of total revenue, denoting their very important role.
2. Global companies leverage India’s cost advantages and skilled workforce for research needs.
3. Focus on ESG factors attracts international firms looking for sustainable insights.
4. Collaboration with international clients enhances innovation and scalability in service delivery.
5. Revenue from international clients supports the industry’s growth and expansion into new markets.

4. Analyse the role of big data in shaping market research trends in India.

1. Big data analytics enables the identification of consumer patterns and preferences.
2. It supports personalized marketing strategies, enhancing customer engagement.
3. The adoption of big data tools improves the accuracy and speed of market research.
4. Big data insights help businesses navigate challenges like market volatility and competition.
5. Emerging sectors, such as e-commerce and finance, rely heavily on big data for strategic decisions.