A new study commissioned by IBM reveals that 59% of enterprise-scale organizations (over 1,000 employees) in India have actively integrated AI into their business operations. The findings are part of the ‘IBM Global AI Adoption Index 2023’, highlighting India as a leader in AI adoption. The report shows that early adopters are setting the pace, with 74% of these Indian enterprises ramping up their AI investments in the past 24 months, focusing on areas such as R&D and workforce reskilling.

Despite this progress, the report also identifies ongoing challenges that hinder wider AI adoption. Key issues include needing more employees with the requisite skills and various ethical concerns. Addressing these barriers will be crucial in 2024, emphasizing the need for robust AI governance frameworks and upskilling initiatives.

“The increase in AI adoption and investments by Indian enterprises is a good indicator that they are already experiencing the benefits of AI. However, there is still a significant opportunity to accelerate as many businesses are hesitant to move beyond experimentation and deploy AI at scale,” said Sandip Patel, Managing Director, IBM India & South Asia. “To harness its full potential in the coming months, data and AI governance tools will be critical for building AI models that enterprises can trust and confidently adopt. Without governance tools, AI can expose companies to data privacy issues, legal complications, and ethical dilemmas – cases we have already seen plaguing many worldwide,” he added.

Key Findings for India from the IBM Global AI Adoption Index 2023

Steady AI Adoption:

• 59% of IT professionals at large Indian organizations report active AI deployment.
• An additional 27% are exploring AI technologies.
• Approximately 60% are implementing or exploring generative AI.
• 74% of those deploying or exploring AI have accelerated investments in the past two years, particularly in R&D (67%), workforce reskilling (55%), and proprietary AI solutions (53%).

Drivers of AI Adoption:

• The accessibility of AI tools (59%), the need for cost reduction and automation (48%), and the embedding of AI in standard business applications (47%) are primary factors driving AI adoption.

Barriers to AI Adoption:

• Limited AI skills and expertise (30%), lack of tools/platforms for AI model development (28%), complexity of AI projects (27%), ethical concerns (26%), and data complexity (25%).

Trust and Governance:

• 98% of IT professionals agree that consumers prefer companies with transparent and ethical AI practices.
• 94% emphasize the importance of explaining AI decision-making processes.
• Despite this, only a minority are taking key steps towards trustworthy AI, such as reducing bias (36%), tracking data provenance (46%), explaining AI decisions (52%), and developing ethical AI policies (46%).
• Top barriers include the lack of an AI strategy (57%), company guidelines (55%), and AI governance tools (55%).

Impact on Workforce:

• AI is being used to address labour or skills shortages by reducing manual tasks (63%), automating customer service (63%), and improving recruitment (56%).
• 46% are training or reskilling employees to use AI tools and 51% report enthusiasm among employees for using AI and automation tools. 

Conclusion

According to the IBM Global AI Adoption Index 2023, 59% of Indian enterprises have actively deployed AI, marking the highest adoption rate among surveyed countries. The report underscores the importance of trust, with 94% of businesses highlighting the necessity of explaining AI decisions. Key drivers for AI adoption in India include the accessibility of AI tools, the need to reduce costs and automate processes, and the increasing integration of AI into off-the-shelf business applications. Despite the significant progress, challenges such as skill shortages and ethical concerns remain, necessitating robust AI governance frameworks and upskilling initiatives to fully harness AI's potential.

Source: IBM Global AI Adoption Index

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