India’s Generative AI Ecosystem Expands Six-Fold In Q2FY25: Nasscom Report

New Delhi, Nov 26 (KNN) In a significant development for India's technology sector, the generative artificial intelligence (GenAI) start up ecosystem has witnessed a remarkable six-fold quarter-on-quarter expansion during the second quarter of fiscal year 2025, according to a comprehensive report by Nasscom.

The surge was characterised by 20 funding rounds, marking a robust recovery fr0m a previously sluggish first quarter.

Notably, early-stage investments, encompassing angel and seed funding, dominated the landscape, representing 77 per cent of the total funding rounds.

The 'Generative AI Tracker: Tech Industry Activity in Q2FY2025' report revealed that total funding grew 3.4 times year-on-year, underscoring the sector's robust momentum.

India has solidified its position in the global GenAI landscape, ranking sixth among major economies in start-up ecosystem share.

Pioneering startups such as Nurix AI, Dashtoon, and Mihup have been at the forefront of transformative advancements, driving innovations in workflow management, digital comic creation, and conversational analytics for contact centres.

The quarter witnessed a strategic shift among technology providers, who moved beyond building use-case portfolios to converting active proofs of concept (PoCs) into production-ready solutions.

Partnerships among providers increased by 25 per cent quarter-on-quarter, with a concentrated focus on product enhancements, collaborative go-to-market strategies, and government-led skill development initiatives.

Revenue pipelines demonstrated significant strengthening as active PoCs transitioned into realised production use cases, signalling a clear emphasis on scalability and enterprise impact.

Simultaneously, talent strategies in the GenAI space evolved, transitioning fr0m basic AI literacy to advanced and thematic upskilling, with a particular focus on platform integration and Agentic AI capabilities.

Sangeeta Gupta, Senior Vice President and Chief Strategy Officer, Nasscom, provided critical insight into this transformative period. "The generative AI landscape is evolving rapidly, reshaping technology service providers and unlocking new capabilities," she stated.

Gupta emphasised that providers are strategically revaluating their approaches and increasing investments in technology and talent, with the second quarter of fiscal year 2025 marking a pivotal moment in India's GenAI ecosystem.

The report suggests that future success in this dynamic sector will hinge on strategic innovations, tangible pilot project results, and the valuable lessons learned throughout the developmental process.

As India continues to position itself as a global technology hub, the generative AI start-up ecosystem stands as a testament to the country's technological prowess and innovative potential.

(KNN Bureau)