India Artificial Intelligence Market Research Report Information by Component (Hardware, Software, Services), by Technology (Machine Learning, Natural Language Processing (NLP), Computer Vision, Context Aware Computing, Generative AI, Others), by Organization Size (Small and Medium Enterprises (SMEs), Large Enterprises), by Deployment Model (Cloud-based, On-Premise), by Application (Finance, Security, Human Resources (HR), Law, Marketing & Sales, Others), by Industry Vertical (BFSI, IT and Telecom, Healthcare, Retail and E-Commerce, Automot

India Artificial Intelligence Market Overview

The India Artificial Intelligence Market was valued at USD 7.63 Billion in 2024. The Artificial Intelligence Market industry is projected to grow from USD 11.17 Billion in 2025 to USD 122.32 Billion by 2035, exhibiting a compound annual growth rate (CAGR) of 42.2% during the forecast period (2025-2035)

The increasing adoption of AI by businesses, government support for AI research and development and rise of deep learning and machine learning technologies are driving the growth of the Artificial Intelligence Market.As per the Analyst at MRFR, the Artificial intelligence market is expected to grow during the forecast period, primarily due to Increasing adoption of AI by businesses, Government support for AI research and development and Rise of deep learning and machine learning technologies.

Moreover, Growth of Growing adoption of cloud-based Al solutions and Expansion of edge AI capabilities for real-time data processing and decision-making is expected to create an opportunity for the players operating in the Artificial intelligence market. However, Cost of AI implementation and Shortage of skilled artificial intelligence professionals are expected to restrict the growth of the Artificial intelligence market to a certain extent during the forecast period.

FIGURE 1: INDIA ARTIFICIAL INTELLIGENCE MARKET VALUE (2019-2035) USD BILLION

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

India Artificial Intelligence Market Opportunity

GROWING ADOPTION OF CLOUD-BASED AL SOLUTIONS

The growing adoption of cloud-based AI solutions presents a significant opportunity for the Indian AI market. As more businesses shift to cloud platforms for scalability, cost-efficiency, and flexibility, the demand for AI-powered services hosted on the cloud is rapidly increasing.

According to NASSCOM, as of today, India ranks among the top countries for cloud infrastructure adoption in Asia, with major global players like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud already having a significant presence in the country.  Cloud-based AI enables companies in India to access advanced machine learning, data analytics, and deep learning tools without the need for expensive infrastructure or in-house expertise. India has over 800 million internet users and a rapidly growing middle class. This massive digital ecosystem is fertile ground for AI-powered cloud solutions.

As more businesses digitize, the demand for cloud services integrated with AI will skyrocket. India has one of the largest pools of AI and cloud computing talent in the world. According to LinkedIn, the number of cloud computing professionals in India has increased by 40% over the past three years. 

The abundance of skilled developers and data scientists will help drive innovation and enhance India’s AI-cloud capabilities. The Indian government is actively investing in digital infrastructure. Initiatives like Digital India, Smart Cities, and Atmanirbhar Bharat aim to push cloud adoption and AI integration. This, combined with favourable regulations and policies, provides a solid foundation for AI-powered cloud growth. This democratization of AI technology is empowering startups, SMEs, and large enterprises across various sectors, such as healthcare, finance, and retail, to innovate and enhance their offerings.

Additionally, the rise of cloud-based AI solutions supports the development of smart cities, automation, and personalized services, further driving growth in the Indian AI ecosystem.

India Artificial Intelligence Market Segment Insights

Artificial Intelligence by Component Insights

Based on Component, the India Artificial Intelligence market has been divided into Hardware, Software and Services. The Hardware segment dominated the India market in 2024, while the Software segment is projected to be the fastest–growing segment during the forecast period. AI hardware refers to the specialized computational devices and components, such as GPUs, TPUs, and NPUs, that facilitate and accelerate the processing demands of artificial intelligence tasks, playing a pivotal role alongside algorithms and software in the AI ecosystem. 

Intelligent programs are resource-intensive; hence, they require a performance-ready hardware system to function. In addition to the hardware that runs the software, the need high-speed cameras, sensors, actuators, and other recommended devices. More importantly, it’s essential to integrate them all with the firmware so that these devices can deliver all the data into a single solution.

Artificial Intelligence by Technology Insights

Based on Technology, the India Artificial Intelligence market has been segmented into Machine Learning, Natural Language Processing (NLP), Computer Vision, Context-Aware Computing, Generative AI and others. The Machine Learning segment dominated the India market in 2024, while the Context Aware Computing segment is projected to be the fastest–growing segment during the forecast period. Machine Learning (ML) is the type of AI that crunches huge datasets to spot patterns and trends, then uses them to build models that predict what will come in the future. 

ML allows Manufactures to forecast fluctuations in demand and supply, estimate the best intervals for maintenance scheduling, and spot early signs of anomalies. machine learning in manufacturing, process plants can improve production quality, predict fluctuations in market demand, reduce the number of serious incidents, raise their reputation for safety and environmental impact, and increase efficiency and productivity across the board. Implementing ML and AI in manufacturing is an ongoing process that continuously delivers value and boosts revenue across the long term.

Artificial Intelligence by Organization Size Insights

Based on the Organization Size, the India Artificial Intelligence market has been bifurcated into into SMEs and Large Enterprises. The Large Enterprises segment dominated the India market in 2024, while the Small and Medium Enterprises (SMEs) segment is projected to be the fastest–growing segment during the forecast period. An enterprise of large size refers to a body that usually consists of over 1,000 employees and generates considerable revenue. It is typically made up of numerous business units plus departments regardless of physical distance between them. 

The organizations are characterized with complex information technology systems; nonetheless, they have IT professionals within their premises to oversee the system. Due to the large volume of financial resources, they can inject into technology as well as the infrastructure itself— which ensures a high return — big data solutions come easily for such firms. The primary aim would be to enhance operational efficiency through utilization of appropriate data at all levels, thus cutting down on operation cost and achieving scalability.

FIGURE 2: INDIA ARTIFICIAL INTELLIGENCE MARKET SHARE BY ORGANIZATION SIZE 2024 AND 2035 (USD BILLION)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Artificial Intelligence by Deployment Model Insights

Based on the Deployment Model, the India Artificial Intelligence market has been bifurcated into Cloud Based and On-Premises. The Cloud-based segment dominated the India market in 2024, while the Cloud-based segment is projected to be the fastest–growing segment during the forecast period. Cloud manufacturing refers to running a manufacturing facility’s software systems and platforms on the cloud. 

The cloud refers to servers that are housed in a provider’s data center and allows other businesses and organizations to run and store their own software and databases on those servers. A company’s software and data are then accessible via the internet, and the company doesn’t have to have physical server equipment at its own physical facility.

Artificial Intelligence by Application Area Insights

Based on the Application Area, the India Artificial Intelligence market has been bifurcated into Finance, Security, Human Resources, Law, Marketing and Sales and Others.  The Finance segment dominated the India market in 2024, while the Marketing & Sales segment is projected to be the fastest–growing segment during the forecast period. AI-powered solutions for fraud detection, risk assessment, and customer service automation are in high demand in the financial sector. U.S. fintech companies can leverage partnerships with Indian banks and financial institutions to deploy AI-driven solutions. 

The finance industry utilizes AI to detect fraud in banking activities, assess financial credit standings, predict financial risk for businesses plus manage stock and bond trading based on market patterns. AI is also implemented across fintech and banking apps, working to personalize banking and provide 24/7 customer service support.

Artificial Intelligence by Industry Vertical Insights

Based on the Industry Vertical, the India Artificial Intelligence market has been bifurcated BFSI, IT and Telecom, Healthcare, Retail and E-Commerce, Automotive, Manufacturing, Transportation and Logistics and Others. The BFSI segment dominated the India market in 2024, while the Healthcare segment is projected to be the fastest–growing segment during the forecast period. AI assists militaries on and off the battlefield, whether it’s to help process military intelligence data faster, detect cyberwarfare attacks or automate military weaponry, defense systems and vehicles. 

Drones and robots in particular may be imbued with AI, making them applicable for autonomous combat or search and rescue operations. Artificial Intelligence is also about to help defense and the military in the coming days. The government is planning to use artificial intelligence for various military operational support. Also, it will help in some automatic artilleries and weapons. Let’s take a closer look at AI applications in the Military. AI algorithms can analyze large amounts of data, including sensor inputs, intelligence reports, and historical information.

These insights provide aid while taking an effective decision that includes stock management, resource allocation, and so on without actual human intervention.

India Artificial Intelligence Key Market Players & Competitive Insights

Many global, regional, and local vendors characterize the Artificial Intelligence Market. The market is highly competitive, with all the players competing to gain market share. Intense competition, rapid advances in technology, frequent changes in government policies, and environmental regulations are key factors that confront market growth. The vendors compete based on cost, product quality, reliability, and government regulations. Vendors must provide cost-efficient, high-quality products to survive and succeed in an intensely competitive market.

The major competitors in the market are IBM Corporation, Oracle, Infosys, Microsoft Corporation, Amazon Web Services (Amazon Inc.), Persistent Systems, KELLTON, Happiest Minds, Tata Elxsi, Meta Platforms, Inc, Zensar Technologies Ltd, ARYA.AI (LITHASA Technologies Pvt. Ltd.), Jio HAPTIK Technologies Limited, Wipro, SAKSOFT are among others. The India Artificial Intelligence Market is a consolidated market due to increasing competition, acquisitions, mergers and other strategic market developments and decisions to improve operational effectiveness.

Key Companies in the India Artificial Intelligence Market include

• IBM Corporation
• Oracle
• Infosys
• Microsoft Corporation
• Amazon Web Services (Amazon Inc.)
• Persistent Systems
• KELLTON
• Happiest Minds
• Tata Elxsi
• Meta Platforms, Inc
• Zensar Technologies Ltd
• AI (LITHASA Technologies Pvt. Ltd.)
• Jio HAPTIK Technologies Limited
• Wipro
• SAKSOFT

India Artificial Intelligence Market Industry Developments

June 2024: Infosys launched Infosys Aster, an AI-powered marketing suite enhancing brand experiences and efficiency. Key features include real-time insights, immersive technologies, and cost-effective campaigns, driving significant growth and operational savings.

June 2024: The American Arbitration Association (AAA) and Zensar Technologies announced their partnership on the introduction of ClauseBuilder AI (Beta). This cutting-edge application makes use of artificial intelligence (AI) to streamline the process of creating arbitration and mediation agreements that are both clear and efficient.

October 2023: Oracle NetSuite announces new generative AI-powered capabilities, NetSuite Text Enhance, to help organizations boost productivity. The feature uses company-specific, relevant data to produce contextual and personalized content across various departments like finance, HR, supply chain, sales, and customer support. It is built on Oracle Cloud Infrastructure and respects customers' data privacy and security.

December 2022: IBM is infusing robots with AI to monitor critical systems at the edge, Combining the power of AI, remote sensing, and edge computing, IBM is working with National Grid and Boston Dynamics to transform how facilities can be monitored for safety issues autonomously

India Artificial Intelligence Market Segmentation

Artificial Intelligence by Component Outlook

• Hardware
• Software
• Services

Artificial Intelligence by Technology Outlook

• Machine Learning
• Natural Language Processing (NLP)
• Computer Vision
• Context Aware Computing
• Generative AI
• Others

Artificial Intelligence by Organization Size Outlook

• Small and Medium Enterprises (SMEs)
• Large Enterprises

Artificial Intelligence by Deployment Model Outlook

• Cloud-based
• On-Premises

Artificial Intelligence by Application Outlook

• Finance
• Security
• Human Resources (HR)
• Law
• Marketing & Sales
• Others

Artificial Intelligence by Industry Vertical Outlook

• BFSI
• IT and Telecom
• Healthcare
• Retail and E-Commerce
• Automotive
• Manufacturing
• Transportation and Logistics
• Others

Report Attribute/Metric	Details
Market Size 2024	USD 7.63 Billion
Market Size 2025	USD 11.17 Billion
Market Size 2035	USD 122.32 Billion
Compound Annual Growth Rate (CAGR)	42.2% (2025-2035)
Base Year	2024
Forecast Period	2025-2035
Historical Data	2019-2023
Forecast Units	Value (USD Billion)
Report Coverage	Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments Covered	By Component, By Technology, By Organization Size, By Deployment Model, By Application, By Industry Vertical
Geographies Covered	India
Countries Covered	India
Key Companies Profiled	IBM Corporation, Oracle, Infosys, Microsoft Corporation, Amazon Web Services (Amazon Inc.), Persistent Systems, KELLTON, Happiest Minds, Tata Elxsi, Meta Platforms, Inc, Zensar Technologies Ltd, ARYA.AI (LITHASA Technologies Pvt. Ltd.), Jio HAPTIK Technologies Limited, Wipro, SAKSOFT
Key Market Opportunities	·         Growing adoption of cloud-based AL solutions ·         Expansion of edge AI capabilities for real-time data processing and decision-making
Key Market Dynamics	·         Increasing adoption of AI by businesses ·         Government support for ai research and development