A new study by Databricks, released in collaboration with Economist Impact, has revealed that 94% of Indian enterprises are now utilizing generative AI (GenAI) in at least one function, marking the highest adoption rate across 19 countries surveyed. The report, titled “Unlocking Enterprise AI: Opportunities and Strategies,” sheds light on the rapid rise of AI in India, where organizations are pushing the boundaries of technology to meet their unique business needs. The survey of 1,100 technical executives and technologists from across the globe also highlights challenges such as cost, skills, governance, and quality, particularly in the Asia-Pacific region, where 40% of respondents cited these as barriers.
Despite the overwhelming adoption, only 24% of Indian respondents believe their GenAI applications are production-ready. These insights come at a time when global AI investment is expected to grow to US$1 trillion, with India’s AI market projected to reach US$17 billion by 2027. The country’s AI market is growing at a compound annual growth rate (CAGR) of 25-35%, according to a report by Nasscom and BCG. However, organizations are still grappling with delivering business-specific, highly accurate results at a reasonable cost.
“As businesses in India rapidly adopt AI, they are setting a new benchmark for integrating data-driven solutions tailored to the customers’ unique needs,” said Anil Bhasin, Vice President and Country Manager for Databricks India. “At Databricks, we are dedicated to supporting this journey by providing platforms that prioritize governance, scalability, and efficiency. This new Economist Impact report reinforces the importance of data intelligence and highlights that industry leaders will be those who take a holistic approach, focusing on robust data management, governance, and specialized expertise. We’re here to empower India’s AI ambitions, contributing to a future where the country leads in building transformative technology for the world.”
The growing demand for AI is transforming industries, with Indian enterprises increasingly leveraging the technology to improve efficiency, productivity, and customer service. AI is now being used in a range of applications, from streamlining clinical trials to detecting potential vehicle issues before they occur. With the rise of ‘Agentic AI,’ companies are expanding AI’s reach to more of their workforce. Notably, 86% of Indian respondents expect that, within the next three years, natural language will be the primary or only way non-technical staff will interact with complex datasets.
For large enterprises like Mahindra Group, AI’s potential is already evident. “We have many listed companies,” said Mohit Kapoor, Group Chief Technology Officer at Mahindra Group. “We ensure data is always identifiable so that it can be segregated, but we can also anonymise that data to drive insights from across our companies.”
Similarly, Amit Sharma, Chief Technology Officer at Dream Sports, highlighted the importance of proprietary data for AI models. “Companies and organisations have access to the best fuel for AI models: the right and most relevant data, not merely data sourced from the open internet. Dream Sports, for instance, found third-party LLMs ineffective, even if [we] were using the latest application because the company’s language is too specific. Models have to be trained on the company’s data,” he said.
The survey also revealed that more than seven in 10 Indian respondents (71%) see AI as crucial to their long-term goals. However, despite the growing enthusiasm, only 29% believe that investment across both technical and non-technical domains is sufficient. The report forecasts that by 2027, 100% of Indian respondents expect GenAI adoption across both internal and external use cases.
Other key findings include the increasing use of proprietary data and the growing use of retrieval-augmented generation (RAG) to enhance large language models (LLMs) in Asia-Pacific. Furthermore, 63% of organizations in India see significant potential in combining LLMs with enterprise data to build more effective data intelligence systems.
However, despite the rapid adoption of AI, enterprises in India and across the region face challenges in securing enough AI talent, with less than three in 10 (29%) Indian respondents confident in their ability to do so. Additionally, 39% of Indian respondents acknowledged that their organizations’ data and AI governance is insufficient. These challenges, combined with fragmented data estates, complicate efforts to ensure high-quality AI outputs and meet evolving AI regulations.
“From classic machine learning to generative AI, the business world’s obsession with AI isn’t letting up. But our findings show that, for many organizations, the real value comes when the technology is unleashed on their own proprietary data to develop data intelligence,” said Tamzin Booth, Editorial Director of Economist Impact. “That data intelligence is even more valuable in an increasingly unpredictable world. To drive the algorithm advantage they’re seeking, it’s clear enterprises must address significant challenges with producing high-quality outputs, identify ways to evaluate performance and governance with large AI models, and work out how to effectively connect AI to the workforce.”
The Economist Impact report reveals that while Indian enterprises are leading the global charge in GenAI adoption, they are also facing crucial hurdles that must be overcome to fully realize the transformative potential of AI.
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