Experts suggest that the fourth industrial revolution is here—and it’s being led by AI. This technology is transforming industries globally, and every nation is reigning on its benefits. India, as of the fastest developing economies, is expected to have a great contribution in the growth and evolution of AI.
According to reports, India hosts a great development and application potential for the technology, and is set to play a significant role in its growth story. In fact, the IndiaAI mission launched in 2024 has already put the nation on track to become one of the global leaders in AI.
According to Nasscom’s recent report published, the AI market in India is expected to hit the range of $17-22 billion by 2027. In this period, experts speculate an investment inflow of over $4 billion, setting the country as a hub for AI growth. Consequently, India is also witnessing a gradual growth in its AI talent pool, potentially rising up from 1.25 million to 1.35 million workers.
“The capital base in India is very strong today… if a few trillion dollars of value is created [globally] because of AI, given the talent base India has, it is possible to create 10% value from India,” said Mukul Arora, Co-Managing Partner at early-stage venture capital firm Elevation Capital.
This optimistic outlook reflects India’s unique position in the global AI landscape. With the right strategies, India can channel its strengths into creating AI-driven solutions that not only address local challenges but also cater to global markets.
While there’s a clear road for India’s contribution to the global AI development, the nation will have to do things right to secure its share in the market. Luckily, India’s diverse population and their requirements is also its biggest opportunity.
The nation’s socio-economic landscape presents numerous challenges, including massive gaps in access to quality education, healthcare, and skill development. AI, with its ability to process vast amounts of data and generate customized solutions, offers a way forward.
Throwing light on the topic, Ashutosh Sharma, Head of Investments at Prosus Ventures said, “The beauty of AI in India is we have a problem of access to quality education, health, skilling, etc. We have tried hard to figure out ways to customize access to quality education etc through the internet 1.0 and 2.0 but the impact is very limited without AI. We have a problem and we have technology and we need someone in the middle to build solutions”.
With AI, India could revolutionize how services are delivered, ensuring they reach the remotest parts of the country.
As the AI landscape heats up, experts are increasingly warning stakeholders to exercise caution in their AI development strategies. Jumping into sectors merely because they are currently ‘in demand’ can be risky.
Instead, India warrants long-term strategies that go beyond immediate gains, and focus on problem-solving and product-market fit (PMF).
While explaining the importance of achieving PMF, Arora said, “Always listen to your customers. If you are getting validation there, then the next question is how to scale it. Don’t worry about what the VCs are thinking, if they think a sector is hot, it is already too late”.
Experts suggest that sustainable AI application and development requires Indian businesses to really understand their customers and solve their problems with the right AI technology. This underscores the importance of a customer-centric approach in AI development. Industrial leaders highlight that startups must focus on creating solutions that resonate with users, thereby ensuring both immediate impact and long-term success.
As India moves toward becoming a global AI leader, the nation must adopt a responsible development approach. This includes robust data protection measures, ethical AI practices, and extensive regulatory support.
“India’s approach to AI must consider its current strengths and weaknesses, necessitating large-scale transformational interventions primarily led by the government, with robust support from the private sector,” said Anil Pawar, Chief AI Officer at Yotta Data Services.
Thus, a coordinated effort involving government policies, private sector innovation, and PMF-driven research will be essential in shaping India’s AI trajectory.