India AI Readiness Surges as Private Investment Triples to $4.1 Billion, Ranks Top 10 Globally

India Secures Top 10 Spot in AI Readiness

India has emerged among the top 10 leading emerging-market performers in AI readiness, positioning itself to harness artificial intelligence as a development tool, according to the World Bank's latest report titled 'India and Artificial Intelligence: Seizing the Development Opportunity'. The country's rise in the AI economy stems from its large technical workforce, globally integrated IT sector and robust digital public infrastructure.1

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Private AI Investment Triples to $4.1 Billion

Private AI investment in India more than tripled to $4.1 billion in 2025 from $1.2 billion in 2024, marking significant confidence in India's AI capabilities. This surge in private AI investment coincides with employment growth in Global Capability Centres, which rose to 2.36 million professionals in 2025 from 1.9 million the previous year. The World Bank Group is investing through AgriConnect in small AI applications targeted at ensuring benefits reach wider populations while supporting workers through the transition.1

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IndiaAI Mission Expands GPU Access and Infrastructure

The IndiaAI Mission, approved with an outlay of Rs. 10,371.92 crore over five years, has onboarded 38,000+ GPUs at a subsidized rate of Rs. 65 per hour, with 20,000 more announced in February 2026. This AI infrastructure initiative lowers entry costs for startups, researchers and students who previously could not afford such computing resources. AIKosh, the national dataset platform, now hosts more than 9,500 datasets and 273 models across sectors, while twelve teams have been selected to develop indigenous foundational models.2

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India's Growing Role in the Global AI Economy

India ranks third in AI competitiveness according to Stanford's 2025 Global AI Vibrancy Tool and stands as the second-largest contributor to GitHub AI projects. The country's technology and AI ecosystem employs more than 6 million people and hosts over 1,800 Global Capability Centres, with more than 500 focusing specifically on AI. Among India's approximately 180,000 startups, nearly 89% of those launched last year integrated AI into their products or services.2

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Economic Projections and AI Adoption Challenges

A joint IBM and IndiaAI study estimates that AI could add more than USD 500 billion to India's economy by 2030, while government projections cite a possible USD 1.7 trillion by 2035. However, AI adoption faces challenges as only 15% of organizations are scaling AI across functions, while most run pilots. About 30% of employees currently possess the AI literacy that businesses require. Anthropic's India brief found that while India accounts for 5.8% of global Claude.ai usage, on a per capita basis it ranks 101st out of 116 countries, with four states accounting for over half of all use.2

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Homegrown Models Address Local Needs

BharatGen, launched in June 2025, represents India's first government-funded model handling text, speech and images across 22 Indian languages. Bhashini, the public translation platform, supports 20 languages and has crossed one million downloads. These foundational models trained on Indian data help people who do not speak English join the digital economy, leveraging India's digital public infrastructure to reach scale quickly.2

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Policy Framework and Global Leadership

Paul Procee, World Bank Acting Country Director for India, emphasized that harnessing AI as a development tool could be one of the most powerful levers India has to boost productivity and improve public services. The World Bank report called for cross-cutting policy measures to deepen AI-enabling infrastructure, improve the business environment, broaden AI adoption and enhance labour capacity. Complementary measures are needed to reduce barriers for small firms, promote local innovation and establish regulatory frameworks that safeguard data security and privacy while reducing uncertainty.1

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India Shapes International AI Dialogue

India hosted the AI Impact Summit in New Delhi from 16 to 21 February 2026, the first in the series held in the Global South. Delegations from more than 80 countries attended, and close to 90 countries and organizations endorsed the nonbinding New Delhi Declaration on trusted and inclusive AI. This diplomatic standing positions India to influence how AI develops worldwide and offer a model for other developing nations.2

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Regional Growth and Workforce Readiness

The World Bank's South Asia Economic Update projects that South Asia will grow 6.9% in 2026, retaining its position as the world's fastest-growing region. Franziska Ohnsorge, World Bank Group Chief Economist for Asia, noted that AI adoption has the potential to transform South Asia's development trajectory by boosting labour productivity, expanding export opportunities and improving public service delivery. However, governments need to address foundational gaps including workforce readiness, business-enabling environments and physical as well as digital infrastructure improvements.1

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