India has woken up to the multi-million dollar opportunities in cloud computing and the government is seriously exploring the possibility of offering public cloud computing facilities.

As part of the drafting of its upcoming National Information Technology Policy (NIP), the government has set up a committee to propose a framework aimed at exploring the public cloud computing market, estimated to be worth around $ 700 million.

Kris Gopalakrishnan, the Executive Co-Chairman of Infosys, one of India’s top-notch IT firms, has been tapped to head the committee. Others in the committee include government bodies such as Department of Information Technology and National Informatics Centers, as well as industry lobby groups such as NASSCOM, CII and FICCI, a report said.

The committee will draft a proposal for developing cloud computing infrastructure within India for the requirements of its over one billion people. The services are expected to be used in healthcare, education, e-governance and banking in a cost-effective manner. The NIP to be discussed this month at the highest level aims to increase India’s revenues in the IT and IT-enabled services sectors from the current $ 100 billion to $ 300 billion by 2020.

As a relatively new entrant in the cloud computing arena, Indians still worry about data protection, privacy and confidentiality.

But the use of cloud services is expected to increase anyway, as small and medium businesses are bypassing costly computing infrastructure in favor of cloud services, offered free or on a pay-as-per-use manner. This will make the public cloud market to grow to $ 685 million by 2014, or 55 per cent compound annual growth rate (CAGR), according to California-based advisory firm Zinnov. Zinnov notes that, while US is currently the major consumer of cloud technologies, emerging markets such as India, China, S. Korea, Brazil and South Africa are now adopting cloud solutions and technologies at a much faster pace and present huge opportunity in the near future.

The overall Indian market for Cloud solutions in the public and private sectors has already grown steadily to $ 860 - 912 mn in 2011. Public Cloud market comprises of 20-22% of the total, Zinnov said in a release.