India Artificial Intelligence (AI) Market

India Artificial Intelligence Market (AI Market) Market is project to add an incremental market revenues of over USD 17 billion between 2024 and 2031 owing to the rising investment by Indian organizations in AI technology to address current business objectives across different verticals, such as customer service, human resources (HR), IT automation, security, recommendations, and many more. Moreover, increasing business resilience and optimizing customer retention are among the top business objectives by organizations for adopting AI solutions and services.

India Artificial Intelligence market Overview

Artificial Intelligence is the simulation of human intelligence in machines specifically programmed to think like humans and mimic their actions. It enables machines to enhance their capabilities in terms of learning, visual perception, speech recognition, decision making and problem solving. AI is being adopted by several industries as it offers several benefits such as the ability to enhance productivity, improve efficiency, and reduce costs.

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Major India Artificial Intelligence market Drivers

AI adoption in India is at a rise owing to rising government initiatives in the country. For instance, in 2021, the government of India partnered with US to launch. US India Artificial Intelligence (USIAI) to scale up the S&T relationship between India and the United States. Moreover, in 2020, NITI Aayog invited several health-tech startups and organizations under the initiative of ‘Empowered Group 6’ in order to leverage their low-cost innovative technologies to combat COVID-19. This included – Qure.ai that uses AI-enabled analysis of chest X-rays to detect Covid-19 lung infections in under a minute and Mfine that is an AI-powered online doctor consultation and telemedicine platform.

Furthermore, the rise of startups in the field of AI will drive growth and innovation in the country. In 2020, Indian AI startups raised $836.3 million, the largest funding outlay during the last seven years. During the same year, Indian government increased the outlay for Digital India to USD $477 million to boost AI, IoT, big data, cybersecurity, machine learning and robotics.

Restraint in the India Artificial Intelligence Market

However, factors such as lack of clarity of rules and regulations and the issues of integrity and ethics with AI and ML solutions is hampering the market growth of AI in India. Policy documents and working drafts on Artificial Intelligence issued by the Niti Aayog recognize ethical and fundamental concerns with the implementation of AI and hints towards a self-regulatory approach towards the same in coming times. Additionally, the policy documentation also identifies ethical challenges in AI based on their impact on the Indian society while recognizing the issues such as the ‘Black Box Phenomenon’, the issues of data collection without proper consent, the privacy of personal data, inherent selection bias, risk of profiling and discrimination, and non-transparent nature of certain AI solutions.

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Offering – Segment Analysis

Based on offering, the software segment occupied the largest market share in 2020 and will continue to witness double digit growth in the coming years. ​Software in AI are being widely used to optimize business operations, automate procedures, improve workplace communication, and get business insights. For instance, Zen3 acquired by Tech Mahindra offers expertise in software product engineering, DevOps testing, AI, machine learning, and analytics.

Technology – Segment Analysis

Based on technology, Natural Language Processing (NLP) is expected to witness the fastest growth in the coming years. Natural language processing technology coverts any text data of businesses such as purchase orders, invoices, social media posts, service agreements, research documents into the searchable text file to increase the efficiency and effectiveness by combing text data. This technology is widely adopted across industries such retail, BFSI among others. For instance, in 2021, ICICI Lombard General Insurance partnered with Microsoft’s speech-to-text tools to build up artificial intelligence (AI) capability in dealing with customers. The company has deployed Azure Speech Services and NLP in its outward call centres to automate supervision of calls.

End User – Segment Analysis

Based on end-user, healthcare industry is expected to witness high implementation of AI in the coming years. Increasing adoption and launching of AI-based technologies in the healthcare industry by the leading players such as in 2021, Roche Diagnostics India, developed AI based application for healthcare workers that includes access to counselling sessions and self-assessment tools.

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Key Developments:

• • In 2021, Intel in collaboration with Central Board of Secondary Education (CBSE), Ministry of Education has announced the launch of the AI For All initiative with the purpose of creating a basic understanding of artificial intelligence (AI) for everyone in India.
  • In 2020, NVIDIA collaborated with IIT Hyderabad to established India’s first NVAITC (NVIDIA AI Technology Centre) to accelerate research on Artificial Intelligence and its commercial adoption.

Segments covered in the Report:

The India Artificial Intelligence market has been segmented on the basis of offering, technology and end-user. Based on offering, the market is segmented into hardware, software and services. Based on technology, the market is segmented into machine learning, natural language processing and others. Machine learning is further bifurcated into deep learning and others. Based on end-user, the market is segmented into healthcare, BFSI, retail, manufacturing, automotive and transportation, agriculture, media and entertainment and others. 

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Market Segmentation

India Artificial Intelligence Market by Offering

• • Hardware
  • Software
  • Services

India Artificial Intelligence Market by Technology

• • Machine Learning
    • Deep Learning
    • Others
  • Natural Language Processing (NLP)
  • Others

India Artificial Intelligence Market by End-User

• • Healthcare
  • BFSI
  • Retail
  • Manufacturing
  • Automotive & Transportation
  • Agriculture
  • Media & Entertainment
  • Others