According to a report by IDC, artificial intelligence (AI) spending will grow at 2.2x the rate of overall digital technology spending in the next three years, generating an India economic impact of over $115 billion by the end of 2027.

IDC also forecasts that by 2027 business executives will demand a minimum 70 per cent success rate on their generative AI (GenAI) initiatives, to achieve operational efficiencies and drive new revenue growth.

Commenting on the report, Neha Gupta, senior research manager, Digital Business and AI Strategies, IDC India, said, “Planned investment in all types of AI is rising at levels much faster than overall digital technology investment. Strategies at leading digital business organisations are focusing heavily on AI so much so that AI transformation and digital business are locked at the hip. Although digital transformation remains foundational to India’s digital journey, AI is clearly leading the charge as a high-growth priority.”

To guide Indian businesses through this transition, IDC outlines critical predictions to become a truly digital business with full-scale integration of AI across enterprises –

  • Evolving digital role of CIO: As digital transformation becomes core to the business strategy, 40 per cent of IT leaders will rise as business leaders by 2027, aligning people, operations, and business models with digital technologies.
  • Digital business architecture trends: By 2027, organisations with an integrated digital business architecture will increase the value generated from their data by three times and cut time to outcomes by 20 per cent.
  • Closing digital skills gaps: By 2027, 55 per cent of India-based organisations will experience digital skills shortages that will cause project delays, slowing AI technology implementations into the following year.
  • Data focus in AI strategy: By 2025, 80 per cent of enterprises will fail to treat data as a product and put in place the discipline to unlock the value of data for all stakeholders, delaying their AI-fueled business models further.
  • GenAI shifts to process modernisation: By 2028, 75 per cent of enterprises that establish an AI platform strategy built on a foundation of connecting processes to broader business functions will achieve enhanced value from their investments.

Further, Gupta added, “IDC’s predictions emphasise AI’s pivotal role in shaping India’s digital business future. New digital businesses are not happening without AI. The rapid rise of AI spending is reshaping the tech investment landscape. The exponential growth in AI underscores its critical role in driving the next wave of innovation, signaling a shift toward more intelligent and automated solutions across industries.”