Table of Contents
The recent EY report on AI India, released on December 17, predicts that as the generative AI (Gen AI) trend grows worldwide, India could see a substantial boost of $1.2-1.5 trillion to its Gross Domestic Product (GDP) in the next seven years. This means that the country’s overall economic value is expected to increase significantly, thanks to the influence of generative AI.
The report sheds light on the potential positive impact of artificial intelligence on India’s economy, indicating substantial growth in the coming years.
EY Report on AI India Unveils Gen AI’s Impact on Digital Transformation & GDP Growth
The report called ‘The AIdea of India: The potential of Generative AI to speed up India’s digital transformation’ predicted that by fully utilizing Gen AI technology and its applications in various sectors, India could potentially contribute $359-438 billion in FY2029-30 alone. This would result in a 5.9-7.2% increase in GDP compared to the baseline.
The EY report on AI India predicts that nearly 69% of growth will stem from businesses using AI in areas like IT, legal, consulting, renting equipment, and more. Sectors like finance, education, retail, and healthcare will benefit too. The impact will arise from things like workers doing more, operations running smoother, and giving customers more personalized experiences.
This means companies using AI could work better, be more efficient, and connect with customers in special ways, resulting in significant improvements, as highlighted in the EY report on AI in India.
Nowadays, big tech companies like Google, Microsoft, Amazon, and IBM are working hard to create really smart generative AI tools for businesses. Recently, Google introduced its big AI model called Gemini, which is super powerful. Gemini wants to compete with OpenAI’s GPT-4 and Meta’s Llama 2.
It’s all happening as mentioned in the EY report on AI India, showing how these companies are trying to make the best AI tools for businesses, aiming for more advanced technology to help them grow.
As these advancements unite, including data center experts like Intel and NVIDIA diving into creating AI abilities in chipsets, there’s a strong push for businesses to use AI. This energetic drive is a result highlighted in the EY report on AI India. It means companies are likely to quickly adopt AI for their operations.
This surge is powered by different tech improvements and big players joining in, aiming to bring AI straight into the core of how businesses operate, potentially changing the way industries work, as noted in the EY report on AI in India.
Developing a strategy for Gen AI construction
In a study by EY on AI in India, they asked 200 top bosses about Gen AI plans. About 75% said having a Gen AI strategy is super important for companies now. They pointed out that making customers happy is the most vital part of this strategy. These big bosses called the C-suite, think that Gen AI, which means the next generation of AI, is crucial for companies to succeed. According to them, focusing on how to engage with customers using Gen AI is key for businesses in India, as highlighted in the EY report on AI in India.
Surprisingly, 73% of companies will seek external technology providers for their implementation.
The EY report on AI in India mentioned that about 60% of companies recognize how much Gen AI affects their businesses. But, surprisingly, around 75% of these companies feel they’re not quite ready to make the most of Gen AI’s advantages. They understand its impact but aren’t fully prepared to use it effectively for their benefit, showing a gap between recognizing its importance and being ready to embrace and utilize its potential in their operations.
According to the EY report on AI India, most organizations have two main problems: not having enough skilled people (52%) and being unsure how to use AI effectively (47%). Surprisingly, only 36% of organizations worry about keeping data private when using Gen AI. This means many struggle with finding skilled workers and figuring out how to use AI properly. Data privacy isn’t a big concern for most, but the skills gap and unclear AI uses stand out as the top challenges for organizations, as highlighted in the EY report on AI India.
Mahesh Makhija, the Tech Consulting Leader at EY India, mentioned that companies are quickly turning to AI for digital change. They want to make customers happier, work better, and be more flexible by using smart models and AI solutions.
He also said that even though AI is just starting, people are excited about its possibilities. To make the most of it, India needs more support from the government. They need to help develop and use AI more to benefit from it, according to the EY Report on AI India.
Adoption by the public sector
The EY report sees Gen AI as a booster for the economy. Governments globally aim to encourage and control AI. They plan to do this by letting more people use training data and markets, using Gen AI in public projects, securing vital digital systems (like 5G, data centers, and AI-ready chips), and making sure there are enough skilled people and money for research. These steps will help grow Gen AI by making it easier to use and improving its innovation, according to the report called “EY Report on AI India.”
According to the EY Report on AI India, Gen AI systems are expected to be used by the government to help everyone. This matches the National Strategy for Artificial Intelligence (2018), focusing on making AI available to everyone. It will help various areas like education, healthcare, farming, and smart cities become better. The goal is to use AI to make things fairer and better for everyone in different parts of life, following a plan that wants AI to benefit all sectors and people, no matter where they are.
Experts from EY have suggested that India can boost Gen AI innovation by focusing on three key areas: gaining access to data and marketplaces, ensuring the security of digital infrastructure, and facilitating talent access and public funding for research and development.
Additionally, India can take inspiration from the UAE and EU by creating an open-source ecosystem for basic algorithms and training datasets. This will enable Indian entities and start-ups to develop their own Gen AI products and accelerate indigenous innovation.
