India's investments in AI to cross $880 mn by 2023: NASSCOM report

The global artificial intelligence investments have doubled in the last year, but India's share in global AI investment remains at 1.5%, the NASSCOM report said

Investments in India’s Artificial Intelligence (AI) capabilities are growing at a CAGR of 30.8 per cent and poised to reach $881 million by 2023, according to the latest report on the AI adoption index by NASSCOM.

The global AI investments have doubled in the last year, but India’s share in global investment remains at 1.5 per cent, the report said. India starts from a lower base compared to its global peers, and despite its high growth, the country will still represent just 2.5 per cent of the global investments in 2023.

AI will aggregate a value-add worth $450-500 billion to India’s GDP by 2025. Over 60 per cent of this is expected to come from the domains of consumer goods and retail, banking, financial services & insurance, energy & industrials, automotive manufacturing, and healthcare, the report said.

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NASSCOM, along with EY, surveyed around 350 enterprises. The study found that around 65 per cent of the organisations have defined AI strategy either at a functional, or enterprise level. India’s AI maturity stands at Enthusiast – the second level of the four-stage adoption assessment.

While Indian companies are using AI for different business functions, predictive analytics and chatbots are the most widely-implemented AI applications in the country.

The report has marked the Personal Data Protection Bill as a major change in policy. It has suggested that companies consider data sanitization and removal of personal identifiers for complying with the proposed norms.

Debjani Ghosh, president of NASSCOM said, “The pandemic has made it an absolutely critical time for organizations to move from data & technology silos to building specialized AI capabilities at scale across sectors combined with a structured data utilization strategy.”

Amitabh Kant, chief executive officer of NITI Aayog, said India still needs to improve in terms of core and applied research, and high-quality research. “Our supercomputing capabilities must be in the same league as in the USA and China,” he added.