India's Tech Surge: 69% Firms to Raise Spending, AI Takes Center Stage AI is not expected to shrink the workforce significantly, only 17 % of executives globally predict a decrease in headcount due to automation
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India is fast emerging as a global leader in artificial intelligence (AI) adoption, with 80 per cent of companies identifying AI as a core strategic priority, surpassing the global average of 75 per cent—reflecting the nation's ambitious digital transformation agenda, as highlighted in Boston Consulting Group (BCG)'s latest AI Radar report, 'From Potential to Profit: Closing the AI Impact Gap.'
Also, sixty-nine per cent of Indian firms plan to increase their tech spending in 2025, with one-third allocating over USD 25 million to AI initiatives, making India one of the top spenders globally.
"In the last few years, India has positioned itself as a leader in AI adoption," said Nipun Kalra, India Leader at BCG X. He noted that Indian companies are leveraging AI to reshape workflows, invent new business models, and drive innovation, further solidifying their position as global AI pioneers.
Leading tech companies stand apart by focusing their investments on a targeted set of AI initiatives, allocating over 80 per cent to transforming core functions and creating new offerings. These companies anticipate 2.1 times greater ROI compared to their peers by prioritizing fewer but deeper use cases.
Contrary to fears of job displacement, AI is not expected to shrink the workforce significantly. Only 7 per cent of executives globally predict a decrease in headcount due to automation. Instead, 68 per cent plan to maintain their current workforce size, focusing on productivity enhancements and upskilling.
Meanwhile, 17 per cent foresee AI creating new roles to replace redundant ones. However, many companies face challenges in upskilling, with fewer than a third having trained even a quarter of their workforce.
Despite optimism, significant challenges persist, particularly around data privacy and cybersecurity. In India, 76 per cent of executives acknowledge the need for substantial improvements in AI-related cybersecurity measures. Regulatory hurdles also pose a major challenge, with 54 per cent of Indian companies citing them as a barrier to AI adoption.
