Indian businesses are transitioning from artificial intelligence (AI) experimentation to fully leveraging their investments for maximum impact. A report reveals that AI will bring long-term benefits to businesses in India, particularly in areas such as innovation (26%), revenue generation (21%), cost saving (12%), and enhanced employee productivity (12%), according to the IBM survey. The survey states that almost 60% of organisations surveyed across the Asia-Pacific region anticipate realising the benefits of their AI investments within two to five years, while just 11% expect returns in the next two years.

“The focus is also shifting from low-risk, non-core use cases, to deploying Gen AI in core business functions for competitive advantage and improved ROI,” it states.

“In 2025, the primary focus of AI investments for Indian organisations will centre on enhancing customer experience (27%), planning and strategy (16%) and optimisation of IT functions (16%),” it adds. To realise these goals, organisations must address key issues including data accessibility issues (46%), limited AI skills (42%) and difficulty in integration and scaling (38%).

“In 2025, AI is set to be the game-changer for Indian enterprises, revolutionising productivity and enabling unprecedented scalability. As we work towards the vision of a Viksit Bharat, the focus will be on leveraging AI responsibly to drive real business value—moving beyond low-risk experiments to strategic initiatives that provide a competitive edge and improved ROI. Additionally, the rise of small, high-performing AI models will redefine efficiency, delivering task-specific results that rival larger models at a fraction of the cost,” says Sandip Patel, managing director, IBM India & South Asia.

Trends shaping India’s AI future:

- AI-led revenue generation takes centre stage: In 2025, organisations will embrace a ‘strategic AI’ approach, prioritising projects based on their feasibility and business impact. This approach highlights the growing understanding that early successes, which build trust and organisational support, must be balanced with long-term AI strategies. The primary challenge is in scaling AI through use cases that maximise revenue opportunities and ROI (return on investment).

- Smaller specialised open-source models emerge as a powerful alternative for many AI applications: There will be a growing demand for purpose-built models, particularly those tailored for local languages, specific regional contexts, and simpler computational tasks. The ‘Rightsizing AI’ models will require far less training data and produce a smaller carbon footprint compared to the large language models that have dominated AI conversations so far.

- Enterprises embrace new tools for visibility, governance and seamless AI integration: Organisations in the Asia-Pacific region will increasingly adopt open-source AI models to foster innovation and enhance efficiency. The ‘Unified AI’, equipped with strong orchestration tools, will simplify the management of these solutions, providing flexibility, cost savings, better security, and smooth integration across various vendors.

- AI agents redefine the future of work: Businesses will increasingly create agent-driven workflows, powered by AI agents, to autonomously perform tasks, collaborate with human workers, and deliver value across the organisation. The ‘Agentic AI’ which merges AI with automation, and decision-making. However, organisations must set internal guidelines and regularly assess the underlying models to ensure ethical and responsible usage.

AI investments

60% of APAC companies expect AI benefits in 2-5 yrs: IBM survey