Based on a survey, the AI industry in India is expected to develop at a compound annual growth rate (CAGR) of 25–35 percent and reach USD 17 billion by 2027.
This development is driven by a number of causes, according to the research “AI Powered Tech Services: A Roadmap for Future Ready Firms; AI & 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 rate of 24% CAGR since 2019, and by 2023, close to USD 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 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.
As to the research, this encompasses the creation of exclusive artificial intelligence and general artificial intelligence platforms, automation tools, data analytics solutions, and custom AI applications tailored to particular industry verticals like healthcare, banking & finance, and retail.
The survey states that with 420,000 workers performing AI-related jobs, India has the second-highest installed talent base.
India possesses three times more skilled AI talent than any other country, making it the country with the highest skills penetration. With a 14-fold increase in AI-skilled personnel over the past seven years, the nation is in the top five, according to the report.
The demand for AI talent in India is predicted to grow at a 15% CAGR until 2027 as investments in AI continue to rise, according to the Nasscom-BCG report. It also noted that over the previous 12 months, the tech sector in India has already seen more than 15% growth 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, realizing the value of human capital in the AI journey. Some corporations have committed USD $1 billion to upskilling over the next three years.
“Indian tech companies, with the advent of Generative AI, are expanding their portfolios beyond traditional IT and business process management to include AI-driven analytics, intelligent automation, and personalized customer interactions,” said Debjani Ghosh, president of Nasscom.
According to her, these businesses are doing more than just using AI; they are also rethinking their service offerings, adding value for their customers, and generating new benchmarks for the sector.
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.