India Begins AI Adoption: 47 Percent of Enterprises Use AI for Multiple Use Cases, Says EY

Indian enterprises are now increasingly looking at generative artificial intelligence (AI) to drive business impact, says a new report. As per the report, nearly half of the surveyed enterprises now have more than one AI use case currently operational internally, while another quarter have said that their AI projects are in the pilot stage. The number highlights that, despite being late to adopt the technology, when compared to Silicon Valley, the country's businesses are now focused on its adoption and are transforming their operations to integrate AI.

AI Adoption in India Reaching Scale

EY India, along with CII, released the third edition of its AI report titled “The AIdea of India: Outlook 2026.” The company surveyed 200 organisations across 20 industries, including government bodies, public sector undertakings (PSUs), startups, enterprises, as well as Indian arms of MNCs. The responses were gathered from CXOs and senior leaders.

One key finding from the report is that 47 percent of Indian enterprises now have multiple AI use cases operational, while 23 percent said that their tools are currently in the pilot stage. Integrating AI technologies across internal operations is a transformative change, and historically, Indian companies have not preferred such organisational reforms. Despite that, the number suggests that businesses in the country see a significant value addition from AI.

Highlighting similar sentiments, the report stated that 76 percent of surveyed business leaders believe that “GenAI will have a significant business impact,” while 63 percent said they are ready to leverage the technology effectively.

Coming to behavioural trends, Indian enterprises are said to prioritise speed of deployment over any other factor to decide whether to buy the technology or build it internally. The fast deployment factor is likely where companies like Google, Microsoft, and OpenAI come in, having recently made India-focused moves to entice enterprises towards their AI solutions.

Among the high-impact divisions, where usage of AI is expected to increase, are operations, customer service, and marketing. Based on the survey, these departments have received 63, 54, and 33 percent nods, respectively.

But when it comes to organisational spending, AI has not seen a drastic improvement despite leadership's conviction. As per the report, more than 95 percent of the surveyed organisations have allocated less than 20 percent of their IT budget for AI. With just four percent crossing the threshold, the optimism appears not to have translated into action. EY states this could be due to reasons such as justifying the expense in a traditional return on investment (ROI) format, which is not possible with a transformative technology such as AI.

Another interesting finding from the report is the enterprise-startup synergy driven by AI. EY says nearly 60 percent of surveyed organisations are co-innovating with startups to drive their AI innovation. “Enterprises are moving away from in-house-only approaches to leverage the agility and experimentation that startups bring, making them essential for staying competitive in the GenAI race,” the report added.