AI could contribute more than $500 billion to India’s economy by 2030, positioning the country among the world’s most dynamic AI-driven economies, suggests a report the IBM Institute for Business Value and IndiaAI, an initiative by Ministry of Electronics & Information Technology (MeitY).

Titled ‘From promise to power: How AI is redefining India’s economic future’, the study states that four in five business leaders believe AI investments will directly influence India’s GDP growth, while 73% expect India to emerge as a leading global AI nation by 2030.

The research also reveals a critical inflection gap as 72% of surveyed organisations acknowledge they are behind global peers in AI adoption. “Bridging this divide between ambition and execution will be pivotal in determining India’s leadership in the global AI economy,” the report said.

The report surveyed 1,500 Indian executives across industries representing diverse organisational sizes and leadership roles, spanning CXOs and departmental heads managing cloud and AI strategies under union and state governments. A supplementary pulse survey of 405 Indian executives was conducted by the same agency to capture the sentiment around AI governance, operating model readiness, security practices, and ecosystem partnerships. 

What are the key findings from the report

For regulated sectors and public systems, a sovereign AI foundation is fast becoming a strategic necessity, as 74% of surveyed executives say that it is essential to have control over data, pointing to a growing convergence around sovereign, “hybrid-by-design” architecture. Organisations are increasingly adopting a hybrid approach to balance performance, cost, and control, with 7 in 10 surveyed executives saying it improves control over data location without significantly increasing costs.

The report said that 57% respondents cite uneven data quality and 77% lack of accessible, affordable, and secure cloud infrastructure are major barriers to AI readiness. Despite the excitement around advanced AI, the findings indicate that Indian enterprises’ ability to scale AI is shaped by the readiness of enterprise data and infrastructure and not by the sophistication of the models.

The study points to a growing skills gap—only about 30% of employees possess the level of AI literacy businesses say they require. By 2030, respondents suggested that figure must rise to nearly 57%. This suggests the total AI talent needed in India will be more than 350 million by 2030.  

15% of surveyed organisations are currently scaling AI through significant cross-functional investments, while the remaining 85% are in pilot-stage AI initiatives. Meanwhile, 62% of respondents say data localisation strengthens trust, while 77% pointed out that Indian-based cloud capacity is critical for trustworthy AI, and 67% say AI innovation will be constrained without stronger domestic capability.

68% of surveyed enterprises cite gaps in AI governance as a barrier to scaling, while 45% say they are piloting or have already embedded governance practices into everyday systems. Partnerships are becoming more focused as 68% of surveyed executives say India needs an ecosystem-oriented approach to AI adoption. 68% of enterprises are already developing, optimising, or scaling external AI partnerships.

“The findings highlight the pressure to rethink how India learns and works—through new education models, redesigned career pathways, and clearer guidance on which skills matter most in an AI-driven economy. Initiatives like IndiaAI FutureSkills are responding by embedding AI fluency into education and corporate training, with data and AI labs expanding across Tier 2 and Tier 3 cities, helping broaden access to AI skills development and to address this gap nationwide,” the report read.