Executive summary.
India is on the cusp of a new wave of economically transformative AI innovation, with the potential to become one of the world’s three leading AI nations. Already, the country has the largest number of mobile AI users globally, a growing number of AI start-ups, and, by building on its existing digital public infrastructure, India can act as a pioneer for AI initiatives in the Global South. AI can help India develop new economic strengths, close gaps in access to public services, and upgrade productivity in sectors from agriculture to retail. India’s AI journey will require a concerted effort from government, industry, and civil society to build infrastructure, empower its workforce with new skills, and ensure that the benefits of this technological revolution reach every corner of the country.
The AI opportunity.
AI is enabling a new era of innovation.
India has some of the highest long-term potential from AI.
India has the highest number of mobile AI users in the world, and Indians express the fourth highest level of optimism globally about the possibilities of AI.
Unlocking opportunities for India’s economy.
AI will save workers time and lead to higher wages.
In the long run, by boosting productivity and allowing workers to focus on higher value tasks, AI could raise the value of hours worked and create potential wage increases of over 6%.
AI can make workers more productive and bridge India’s skills gaps.
In our modelling, we found that the potential skills gains from AI could boost the average worker productivity by over ₹2,40,000 (US$2,800) a year. This is equivalent to a 45% increase in existing labour productivity levels.
From agriculture to e-services, AI can help strengthen the Indian economy.
According to our modelling, the three sectors with the highest potential for AI usage are public administration, manufacturing and retail.
Fostering Indian innovation for global solutions.
India is pioneering AI initiatives in the Global South.
In our research, we found that scaling AI use cases, like those pioneered by Indian apps BHASHINI, DIKSHA, and eCourts, internationally could create an additional ₹7,100 crore (US$840 million) for the Indian economy.
Strengthening public outcomes.
AI can make for a more dynamic public sector.
In total, we estimate that AI could help increase productivity in the public sector in India by ₹5.9 lakh crore (US$70 billion). That is the equivalent to the cost of building nearly 1.4 lakh secondary schools.
AI can expand access to basic tutoring and medical diagnosis.
In total, we estimate that AI tutors could help boost the skills of 110 million people who currently do not have access to formal education. And 71% of people we surveyed told us they supported the use of AI to diagnose patients.
71% of people we surveyed told us they supported the use of AI to diagnose patients.
Maximising the AI opportunity.
Indian workers showed a strong interest in more training in AI skills.
91% of workers said they would like to know more practical use cases of how to use AI, and 89% said they wanted to better understand how AI models worked.
In order to maximise its AI potential, India will need to continue to reduce connectivity gaps and encourage widespread adoption.
To realise AI’s full potential, India must address adoption gaps across demographics. Failing to reverse the current gap between men and women, different age groups, and residents with varying education levels could reduce the potential economic benefits from AI by 18%.
to learn how to use AI.