New Delhi, Dec 16 (UNI) India stands at a crucial juncture in the global artificial intelligence landscape as AI adoption accelerates worldwide, costs fall sharply, and governments race to strengthen their technological capabilities, according to the Artificial Intelligence Index Report 2025 released by Stanford University.
The findings suggest that while the global AI race is becoming more competitive, the evolving nature of AI technology is opening fresh opportunities for emerging digital economies like India.
The report highlights that artificial intelligence has moved decisively from experimentation to large-scale real-world deployment. Across sectors such as healthcare, manufacturing, transportation, finance, and education, AI systems are now delivering tangible outcomes.
For India, this shift is particularly significant as its economy increasingly relies on digital platforms, data-driven services, and technology-enabled governance.
One of the most encouraging trends for India is the steep decline in AI costs. The report shows that the cost of using AI models with capabilities comparable to earlier large language models has fallen by more than 280 times in less than two years.
This dramatic drop lowers barriers for Indian startups, small and medium enterprises, and public-sector institutions, allowing them to deploy advanced AI tools without massive capital expenditure.
As a result, AI adoption in India is expected to deepen across sectors such as vernacular language technologies, digital payments, telemedicine, agricultural advisory services, and logistics.
India’s research presence in AI is also becoming more visible on the global stage. The country now contributes over 9 per cent of global AI research publications, reflecting growing academic engagement and increased focus on artificial intelligence across universities and technical institutions.
This research momentum aligns with India’s broader ambition to become a global knowledge hub, though the report indicates that converting research output into globally influential AI models remains a key challenge.
Globally, the report notes that industry has taken the lead in developing advanced AI models, accounting for nearly 90% of notable AI systems in 2024. This trend underscores the importance for India to strengthen industry-led innovation, particularly through startups, technology firms, and public-private partnerships. While Indian companies have traditionally excelled in IT services and software deployment, the next phase will require greater emphasis on core AI model development, infrastructure, and product innovation.
Government involvement in AI is increasing worldwide, and India is among the countries actively investing in national AI capabilities. The report points to India’s commitment of over USD 1.25 billion toward AI infrastructure as a strategic move to support computing capacity, research ecosystems, and digital public infrastructure.
This investment gains added importance as AI models become more compute- and energy-intensive, placing pressure on data centres, power supply, and high-performance computing resources.
Education and workforce readiness emerge as another critical area for India. The report observes that two-thirds of countries globally now offer or plan to offer computer science education at the school level.
For India, with its large youth population and expanding digital economy, scaling AI education and reskilling programmes could prove decisive. As AI boosts productivity and reshapes job roles, the ability to equip workers with AI literacy and applied skills will determine how broadly the benefits of automation are shared.
At the same time, the report flags growing concerns around trust, fairness, and governance. Globally, public confidence in AI companies’ ability to protect data is declining, and worries over bias, misinformation, and deepfakes are increasing.
These issues have particular relevance for India, given its large democratic electorate and rapidly growing digital user base. As AI tools become more accessible, ensuring responsible use through clear policies, safeguards, and transparency mechanisms will be essential.
The report also notes a gradual rise in global optimism about AI’s societal benefits, even as skepticism persists in several advanced economies. For India, where digital adoption has often leapfrogged traditional systems, AI presents an opportunity to improve service delivery, expand access to healthcare and education, and support inclusive growth—provided governance keeps pace with innovation.
Overall, the Artificial Intelligence Index Report 2025 paints a picture of an AI ecosystem that is expanding rapidly but becoming more evenly distributed as costs fall and access improves. While the United States and China continue to dominate in investment and frontier model development, the changing economics of AI offer India a window to strengthen its position.
With sustained investment, stronger industry-academia collaboration, and a focus on responsible deployment, India could play a far more influential role in shaping the next phase of the global AI economy.
