India’s AI market set to skyrocket, poised to reach US$17 Billion by 2027, says Nasscom-BCG report
India’s AI market is rapidly growing, driven by innovation. It is making strides in healthcare, agriculture, finance, and more. India’s focus on technological advancement is propelling it to become a major player in the global AI market. India’s AI market is experiencing rapid growth and is poised to reach US$17 billion by 2027, becoming the top category of IT spending in 2023, according to a report by Nasscom-BCG. The country is projected to see a 25% CAGR in the AI market, with similar growth in AI investments. Globally, investments in AI have grown by 24% CAGR since 2019, with 2023 seeing close to US$83 billion invested. The majority of this investment has been in horizontal AI applications such as data analytics, genAI, and ML algorithms and platforms.
India presently has the second-highest installed skill base with 420,000 workers in AI jobs. It also has the highest skills penetration, with a threefold growth in skilled AI talent compared to other countries. India ranks among the top five nations with 14 times growth in individuals skilled in AI in the last seven years. The need for AI expertise in India is predicted to rise at a 15% CAGR by 2027 as investments in AI continue to rise. The technology industry in India has already seen over 15% growth in AI/ML jobs over the past 12 months, with positions such as AI engineers growing at a remarkable 67% year-on-year.
Debjani Ghosh, president of Nasscom, highlighted the transformation of Indian tech companies with the advent of GenAI. These businesses are adding AI-driven analytics, intelligent automation, and customized customer experiences to their portfolios in addition to traditional IT and business process management. Not only are they using AI, but they are also reframing their service offerings, adding value for their customers, and establishing new benchmarks for the sector.
Rajiv Gupta, MD, and senior partner at BCG, emphasized the strides Indian companies are making in keeping pace with the growth of AI. The tech sector in India is creating future-ready organizations with dynamic and evolving centers of excellence driving the AI agenda. This shift is helping companies stay competitive in a rapidly evolving technological landscape.
The growth of AI in India is not just limited to the tech sector. Various industries such as healthcare, finance, retail, and manufacturing are also leveraging AI to improve efficiency, reduce costs, and drive innovation. AI is being used for predictive analytics in healthcare, fraud detection in finance, personalized shopping experiences in retail, and predictive maintenance in manufacturing, among other applications.
In conclusion, India’s AI market is on a rapid growth trajectory, with significant investments, a strong talent base, and a burgeoning ecosystem of AI-driven companies. The country is well-positioned to become a global leader in AI, driving innovation, and shaping the future of technology.
