As per MRFR analysis, the India Applied AI Market Size was estimated at 8.35 (USD Billion) in 2023.The India Applied AI Market is expected to grow from 10.46(USD Billion) in 2024 to 63.56 (USD Billion) by 2035. The India Applied AI Market CAGR (growth rate) is expected to be around 17.823% during the forecast period (2025 - 2035)
Key India Applied AI Market Trends Highlighted
A number of important market factors are driving the notable expansion of the applied AI market in India. As part of its Digital India project, the Indian government has been aggressively pushing artificial intelligence with the goal of improving digital infrastructure and encouraging innovation across a range of industries.
This effort promotes AI research and development in addition to increasing the application of AI technologies. Businesses now have a wealth of resources to successfully deploy AI solutions thanks to the quick rise in data collection and the spread of cutting-edge computing technologies like cloud computing.
The growing need for AI applications across a range of industries, including healthcare, finance, agriculture, and education, presents opportunities to be investigated. AI technology integration in various fields has the potential to enhance productivity and decision-making, which makes it essential to India's future development.
AI is being used more and more by startups and well-established businesses for automation, natural language processing, and predictive analytics, signalling a thriving market for investment and innovation. A rise in AI-driven goods and services designed especially for the Indian market is seen in recent developments.
Companies are concentrating on localised solutions that tackle the particular difficulties faced by Indian customers in addition to worldwide applications. Due to a youthful and technologically literate populace, small and medium-sized businesses (SMEs) are increasingly utilising AI to gain a competitive edge.
Furthermore, partnerships between academic institutions and business leaders are become more frequent, which promotes a knowledge-driven ecosystem that is crucial for AI's long-term growth in India. The increasing awareness of responsible AI deployment in society is reflected in the growing importance of ethical AI practices and laws as the market develops.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
India Applied AI Market Drivers
Growing Investments in Research and Development
The India Applied Artificial Intelligence Market is witnessing significant growth due to increasing investments in Research and Development (R&D) by both the government and private sector. As of 2022, the Indian government announced a National Strategy for Artificial Intelligence that aims to boost R&D and innovation in AI technologies.
The allocation of USD 500 million for the 'Digital India' initiative underscores the government's commitment to harness AI's potential. Companies like Tata Consultancy Services and Infosys are heavily investing in R&D, with TCS reporting a 20% increase in its AI-related expenditure gear aimed at developing innovative solutions in areas such as healthcare, finance, and transportation.
This focus on R&D is vital as it not only enhances the technological capabilities but also attracts foreign investments, further propelling the market growth in India.
Increased Adoption of AI in Various Industries
The increasing adoption of Artificial Intelligence across diverse sectors such as agriculture, healthcare, and finance is a major driver for the India Applied Artificial Intelligence Market. For instance, according to the Ministry of Electronics and Information Technology in India, AI technologies have shown to increase productivity in agriculture by 15% and reduce costs by up to 20%.
Major corporations like Mahindra and Mahindra are implementing AI solutions to improve farming techniques and yield productivity. Healthcare organizations are also adopting AI for diagnostics and patient care management, resulting in improved outcomes and cost efficiency. This widespread adoption signifies a robust market demand for AI applications across diverse industries.
Government Policies Supporting AI Development
Government policies aimed at fostering the growth of Artificial Intelligence significantly impact the India Applied Artificial Intelligence Market. The Indian government has launched initiatives such as 'AI for All', which seeks to make AI accessible for various segments of society, highlighting their commitment to AI development.
The government's commitment is reinforced with a projected annual growth of over 20% in the AI value chain from 2024 to 2030 as reported by the NITI Aayog, the policy think tank of the Government of India. This favorable policy environment is creating new opportunities for startups and established businesses alike to develop and deploy AI solutions in various sectors, contributing to market growth.
India Applied AI Market Segment Insights
Applied AI Market Components Insights
The India Applied AI Market's Components segment plays a crucial role in shaping the country's technological landscape, reflecting a strong trajectory of growth. The overall market is projected to experience significant expansion, demonstrating the increasing adoption of AI solutions across various sectors, driven by the need for enhanced efficiencies and data-driven decision-making.
Within this segment, the focus on Software and Services is particularly noteworthy. Software is key, providing the essential tools and frameworks that enable organizations to deploy AI algorithms effectively, thus streamlining operations and improving productivity.
The rapid growth in cloud computing has further fueled this software development, allowing businesses of all sizes to leverage advanced AI capabilities without substantial upfront infrastructure investments. On the other hand, the Services aspect caters to the diverse needs of businesses looking to implement AI technologies.
This includes consulting, implementation, and maintenance services that are vital for tailoring AI solutions to specific industry requirements. As organizations in India increasingly shift towards automation and intelligent systems, the demand for skilled professionals offering support in these areas has surged.
This rise highlights the importance of having a comprehensive understanding of both the technological and operational challenges businesses face during AI adoption. The government's initiatives to incorporate technology in public services have also created a fertile ground for the growth of the applied AI market within India.
Such efforts demonstrate a commitment to fortifying the economic landscape with intelligent tools that can enhance efficiency in sectors like healthcare, finance, and transportation. Furthermore, educational institutions are increasingly aligning their curricula towards AI technologies, ensuring a steady pipeline of talent equipped to support the evolving demands of the industry.
As the Components segment continues to dominate, it reflects a significant shift in India’s approach toward technology adoption, supporting the country’s ambition to become a global leader in AI innovation. The combination of advancements in Software and Services not only feeds into the core of the AI economy but also sets the stage for India’s future growth in technology-driven sectors.
In this rapidly developing space, opportunities are abundant for businesses willing to invest in AI technologies, supported by the robust landscape of skilled labor and favorable governmental policies. This environment encourages the convergence of AI across various industries, underpinning the ongoing shift toward more intelligent, automated business processes throughout India.
With the demand for skilled talent and innovative solutions rising, the Components segment of the India Applied AI Market is poised for continued significance and evolution in the years to come.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Applied AI Market Application Insights
The India Applied AI Market, particularly in the Application segment, showcases significant potential across various sectors, contributing to the overall digital transformation initiatives in the country.
With the market projected to exhibit substantial growth, sectors such as Healthcare and Finance have emerged as key players, leveraging AI for enhancing diagnostic accuracy and driving financial analytics, respectively.
Retail and E-commerce utilize AI for personalized shopping experiences and inventory management, while Predictive maintenance and Industrial robotics streamline manufacturing processes, elevating operational efficiency.
Natural Language Processing stands out by improving communication between machines and humans, facilitating customer service automation. Moreover, the Energy and Utilities sector harnesses AI for optimizing resource allocation and predictive analytics, which is crucial for sustainable practices in India’s growing economy.
In Agriculture, AI aids in precision farming, helping farmers make informed decisions based on data-driven insights. Cybersecurity benefits from AI in threat detection and response, protecting sensitive information amidst increasing digitalization.
Educational frameworks incorporate AI to customize learning experiences for students, while Entertainment and Media sectors use it for content personalization and recommendation algorithms.
Real Estate gains from AI in property valuation and market analysis, and Transportation and Logistics enhance route optimization, while Environmental Monitoring utilizes AI to track climate changes and resource management.
Overall, the array of applications signifies how AI technologies are positioned to influence diverse industries in India, fostering innovation and enhancing efficiency across the board, ultimately driving the market growth.
India Applied AI Market Key Players and Competitive Insights
The India Applied AI Market has witnessed significant growth in recent years, driven by the increasing adoption of artificial intelligence across various sectors such as healthcare, finance, and retail. With advancements in machine learning, natural language processing, and computer vision, businesses are leveraging applied AI to enhance operations, improve customer experiences, and drive innovation.
The competitive landscape is characterized by a mix of established players and emerging startups, each vying to capture market share through innovative solutions, strategic partnerships, and investment in research and development.
The ability to harness data for actionable insights has become a key differentiator, with companies focusing on developing tailored AI applications that meet the specific demands of Indian consumers and businesses.
Tech Mahindra holds a strong position within the India Applied AI Market, showcasing its capabilities through a robust portfolio of AI-driven solutions aimed at enhancing customer service and operational efficiency. The company's expertise lies in developing intelligent automation tools that are integrated into existing business processes, thereby optimizing performance and reducing costs for clients.
Tech Mahindra has adopted a proactive approach to foster innovation, investing in research and development to stay ahead of technological advancements. By establishing partnerships with leading technology providers, Tech Mahindra has enhanced its service offerings, catering to a diverse clientele across various sectors in India.
The company's commitment to digital transformation ensures that it remains competitive in the rapidly evolving AI landscape.
Cognizant is also a notable player in the India Applied AI Market, recognized for its comprehensive suite of AI services that address various business needs. The company's key offerings include AI-driven analytics, machine learning platforms, and intelligent automation solutions tailored for Indian enterprises.
Cognizant's strong market presence is bolstered by strategic mergers and acquisitions that expand its technological capabilities and client base within the region. By focusing on industry-specific applications of artificial intelligence, the company effectively addresses challenges faced by clients in sectors such as banking, consumer goods, and healthcare.
Cognizant’s investment in upskilling its workforce in AI technologies enables it to provide cutting-edge solutions that empower clients to harness the power of data effectively. This dedication to innovation and client-centric service solidifies Cognizant's reputation as a formidable force in the competitive landscape of the India Applied AI Market.
Key Companies in the India Applied AI Market Include
India Applied AI Market Developments
Under the IndiaAI Mission, the Indian government formally established the AI Safety Institute in January 2025 with the goal of creating guidelines, risk assessments, and moral standards for the use of AI. As businesses continue to prioritise generative AI technologies, national AI investment increased in April 2025. According to forecasts, AI budgets will almost triple this year compared to 2024.
Google introduced the AI First India 2025 Accelerator in May 2025, providing mentorship and access to cutting-edge AI infrastructure to early- to growth-stage AI entrepreneurs. The Maharashtra government previously announced the MahaAgri-AI Policy in February 2025, setting aside ₹500 crore to implement drone and AI technology for precision farming over the following three years.
SuperOps, an enterprise AI firm based in Bengaluru, raised $25 million in Series C funding in April 2025 to advance its AI-first ITOps solutions. Lastly, in October 2024, Sarvam AI, a generative AI business, raised $41 million in Series A funding to increase the number of large language models it offers in Indic.
The dynamism and strategic prioritisation of applied AI across industries including agriculture, enterprise services, and governance in India are highlighted by these projects, which collectively span public policy, startup finance, and ethical frameworks.
India Applied AI Market Segmentation Insights
Applied AI Market Components Outlook
Applied AI Market Application Outlook
| Report Attribute/Metric Source: | Details |
| MARKET SIZE 2023 | 8.35(USD Billion) |
| MARKET SIZE 2024 | 10.46(USD Billion) |
| MARKET SIZE 2035 | 63.56(USD Billion) |
| COMPOUND ANNUAL GROWTH RATE (CAGR) | 17.823% (2025 - 2035) |
| REPORT COVERAGE | Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| BASE YEAR | 2024 |
| MARKET FORECAST PERIOD | 2025 - 2035 |
| HISTORICAL DATA | 2019 - 2024 |
| MARKET FORECAST UNITS | USD Billion |
| KEY COMPANIES PROFILED | Tech Mahindra, Cognizant, Wipro, Infosys, Mphasis, ZS Associates, HCL Technologies, Mu Sigma, Tata Consultancy Services, Fractal Analytics, LTI, Manthan, Quantiphi, Numpy, Mindtree |
| SEGMENTS COVERED | Components, Application |
| KEY MARKET OPPORTUNITIES | Healthcare automation solutions, Retail personalized experiences, Agricultural data-driven insights, Financial fraud detection systems, Smart city infrastructure enhancements |
| KEY MARKET DYNAMICS | Rapid technology adoption, Increasing government support, Growing demand for automation, Rising investment in startups, Expanding industry applications |
| COUNTRIES COVERED | India |
Frequently Asked Questions (FAQ) :
The India Applied AI Market is expected to be valued at 10.46 USD Billion in 2024.
By 2035, the India Applied AI Market is projected to reach a value of 63.56 USD Billion.
The expected CAGR for the India Applied AI Market from 2025 to 2035 is 17.823.
Key players in the India Applied AI Market include Tech Mahindra, Cognizant, Wipro, Infosys, and Tata Consultancy Services.
The Software component of the India Applied AI Market is expected to be valued at 4.18 USD Billion in 2024.
In 2024, the Services component of the India Applied AI Market is expected to be valued at 6.28 USD Billion.
The Software segment is projected to reach a market value of 27.0 USD Billion by 2035.
By 2035, the Services segment is expected to reach a market value of 36.56 USD Billion.
Key opportunities include advancements in machine learning, increased automation, and growing demand for data analytics.
Current global economic conditions influence technology investments and can create both challenges and opportunities in the India Applied AI Market.
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Team Lead - Research she holds an experience of about 6+ years in market research and business consulting, working under the spectrum of information communication technology, telecommunications and semiconductor domains. aarti conceptualizes and implements a scalable business strategy and provides strategic leadership to the clients. her expertise lies in market estimation, competitive intelligence, pipeline analysis, customer assessment, etc.
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