AI Momentum in India – Challenges and Opportunities

Indian Companies Lead Global AI Adoption Surge Despite Skills Gap: Deloitte Report​

Large-Scale AI Deployment Gains Momentum Across Key Business Functions​

New Delhi, March 22
Indian companies are outpacing their global counterparts in adopting Artificial Intelligence at scale, with a growing number of organizations moving beyond pilot projects to full-scale implementation, according to Deloitte’s latest report.

The report titled State of AI in the Enterprise 2026 highlights that Indian firms are leading in integrating AI across critical business functions. Large-scale deployment is most prominent in product development at 62 per cent, followed by strategy and operations at 56 per cent, marketing and sales at 55 per cent, and supply chain at 48 per cent. This trend reflects how AI is becoming central to driving growth, efficiency, and competitive advantage.

Indian Firms Outperform Global Average in AI Utilization​

The findings reveal that 40 per cent of Indian organizations report significant or full AI usage, notably higher than the global average of around 28 per cent. This indicates a clear shift from experimentation to operational deployment, with businesses leveraging AI for measurable productivity gains and business outcomes.

The India-specific insights are drawn from Deloitte’s global survey, with responses from over 200 business and technology leaders across the country.

AI Spending Set to Rise Sharply​

The report underscores strong future investment intent, with 94 per cent of Indian organizations expecting to increase their AI budgets over the next year. This signals sustained momentum in AI adoption as companies prioritize digital transformation initiatives.

Capability Gap Remains a Key Concern​

Despite rapid progress, Indian companies face a notable shortage of specialized AI expertise. Only 0 to 4 per cent of organizations report high levels of AI capability, compared to the global range of 2 to 8 per cent. This gap presents a challenge in sustaining and scaling AI initiatives effectively.

Regulatory Challenges and Change Resistance Slow Adoption​

Regulatory and compliance requirements emerge as the primary barrier to AI adoption, cited by 39 per cent of respondents. Resistance to change within organizations follows at 34 per cent.

In contrast, fewer companies identify cost at 12 per cent and infrastructure at 5 per cent as major constraints. This suggests that governance readiness and adapting operating models are more immediate hurdles than financial or technical limitations.

Strong Expectations for Productivity Gains​

Even with these challenges, Indian organizations remain optimistic about AI-driven outcomes. Nearly all respondents expect productivity improvements, with 97 per cent anticipating gains in efficiency and performance.

Deloitte noted that Indian enterprises are entering a critical phase in their AI journey, transitioning from experimentation to enterprise-wide execution. The focus ahead is expected to shift toward building institutional capabilities, strengthening governance frameworks, and aligning workforce skills with evolving technological demands.