India’s Strong AI Market To Actually Reach Billions In 2027

Research projects that the AI market in India will reach $17 billion by 2027, with a compound annual growth rate of 25–35%.
This development is driven by a number of causes, according to the research “AI Powered Tech Services: A Roadmap for Future-Ready Firms; AI and GenAI’s Role in Turbocharging the Industry,” including rising business tech spending, India’s expanding AI talent base, and a notable increase in AI investments. At the Nasscom Technology & Leadership Forum 2024 here on Tuesday, the Nasscom report, produced in collaboration with BCG, was unveiled.
According to the report, global investments in AI have grown at a 24% CAGR since 2019, and by 2023, close to $83 billion will have been invested.

According to the research, the majority of investments were made in ML algorithms and platforms, GenAI, and data analytics.
Notably, the survey states that supply chain, data analytics, and digital content account for almost 93% of the investments made by Indian tech services and made-in-India product companies.

Technology service providers are expanding their offerings beyond standard IT services by creating a wide range of cutting-edge AI-based services and solutions in response to rising enterprise tech investment, according to the report.
According to the research, this includes the creation of specialised AI apps for particular industry verticals, including healthcare, banking & finance, and retail, as well as proprietary AI and GenAI platforms, automation tools, and data analytics solutions.

With 420,000 workers performing AI-related jobs, India has the second-highest installed skill base, according to the survey.
With three times more AI-skilled talent than other nations, India also has the highest skill penetration rate. According to the report, the nation is among the top five countries in the world, with a 14-fold increase in AI-skilled people over the last seven years.
The Nasscom-BCG report stated that as AI investments rise, so too will the demand for AI talent in India, which is predicted to grow at a 15% CAGR through 2027. It also noted that over the previous 12 months, the tech sector in India has already seen a growth of more than 15% in AI/ML jobs, with positions like AI engineers growing at a rate of 67% annually.

Leading companies have made significant investments in reskilling and upskilling their staff in AI and associated technologies, realising the value of human capital in the AI journey. Some organisations have committed USD $1 billion to upskilling over the next three years.

According to Ghosh, in order to speed up this process, significant expenditures in AI skill development, secure and moral AI development procedures, governance frameworks, and a fundamental change to a human-centered strategy that places an emphasis on openness and human oversight are all necessary.