AI Could Add USD 500 Bn To India’s Economy By 2030: IBM-IndiaAI Study

New Delhi, May 13 (KNN) India is entering a crucial phase in its economic transformation, with artificial intelligence (AI) expected to move from experimentation to a core driver of growth, according to a joint study by IBM Institute for Business Value and IndiaAI.

The report, titled ‘From Promise to Power: How AI Is Redefining India’s Economic Future’, released on Wednesday, estimates that AI could contribute over USD 500 billion to India’s economy by 2030, positioning the country among the leading AI-driven global economies.

At the report’s launch, Ministry of Electronics & Information Technology (MeitY) Secretary S Krishnan said, “India is no longer just participating in the global AI conversation, we are helping shape it. Our vision is clear. AI must evolve as an extension of our people’s aspirations, driving inclusive growth and national progress.” 

“Guided by our vision of Viksit Bharat, we are advancing a human centric approach to AI rooted in trust, ethics, and national sovereignty. This joint IndiaAI and IBM study is a timely contribution that will help align policy, industry, and innovation to unlock AI’s full potential for India’s economic future,” Krishnan added.

Strong Optimism, But Execution Gap Persists

The study highlights strong business confidence in AI’s potential. Around 80 per cent of business leaders believe AI investments will directly impact India’s GDP growth, while 73 per cent expect the country to emerge as a global AI leader by 2030.

However, a significant gap remains between ambition and execution. About 72 per cent of organisations said they are lagging behind global peers in AI adoption, indicating the need for faster implementation.

Push for Sovereign and Hybrid AI Models

The report points to a growing preference for sovereign and hybrid AI systems, especially in regulated sectors. About 74 per cent of executives stressed the importance of controlling where data is stored.

A hybrid model—combining domestic infrastructure with global innovation—is emerging as a practical approach, with 70 per cent of respondents saying it improves data control without significantly increasing costs.

Data and Infrastructure Challenges

Despite growing momentum, key barriers remain. Around 57 per cent of respondents cited poor data quality, while 77 per cent pointed to limited access to affordable and secure cloud infrastructure as major hurdles.

The findings suggest that India’s AI progress will depend less on advanced models and more on strengthening data systems and digital infrastructure.

Widening AI Skills Gap

The study also flagged a rising talent gap. Currently, only about 30 per cent of the workforce has the required level of AI literacy, while this needs to increase to nearly 57 per cent by 2030.

India may require over 350 million AI-skilled workers by the end of the decade, highlighting the need for large-scale upskilling, new education models, and industry-led training initiatives.

Industry Transition and Governance Focus

Most companies are still in early stages of AI adoption, with only 15 per cent scaling AI across operations, while the rest remain in pilot phases.

At the same time, governance and partnerships are emerging as critical enablers. Around 68 per cent of firms identified gaps in AI governance as a barrier, and a similar share emphasised the need for stronger ecosystem collaboration.

(KNN Bureau)