Mr Phang: The public sector within the APEJ region represents an industry of diverse spending.

Government spending on IT services and products will continue to increase steadily in the Asia Pacific excluding Japan (APEJ) with a compound annual growth rate (CAGR) of 7.9 per cent from 2007-2011, according to the latest study from research firm Government Insights  (http://www.government-insights.com/).

"The public sector within the APEJ region represents an industry of diverse spending behaviour, with spending expected to exceed US$32 billion by 2011," said Mr Raphael Phang, Research Director of Government Insights Asia Pacific.

The IT growth will be driven largely by China and India, which together account for more than half of the total. These countries have been building up their information   and communications technology infrastructure to increase outreach to their citizens, especially in the rural areas, noted Phang.

With a double-digit CAGR in China (10.2 per cent) and India (17.6 per cent), the growth rate of these developing countries also outpaces all other countries within the region, said Mr Phang.

Government Insights also predicts that overall IT expenditure will continue to be largely driven by hardware, although a slight decline is expected from 57.5 per cent of expenditure in 2007 to 54 per cent in 2011. Expenditure on services and software, on the other hand, is expected to increase steadily.

According to Mr Phang, IT investment in the APEJ government sector will remain strong. However, growth is expected to slow down as spending on large infrastructure projects begins to decline with e-government initiatives shifting beyond the infrastructure build-out stage, towards maximising the value of existing infrastructure, he said.