India is among the top ten countries in Artificial Intelligence (AI) readiness, and the country holds immense potential for public sector transformation through AI, according to a report.
“Readiness” for AI refers to an economy’s ability to effectively implement and integrate AI. The report by Boston Consulting Group (BCG) based on data from 73 economies showed that India ranks second globally in AI specialists, and third in research publications, with a strong base in AI-related patents.
On the other hand, over 70 per cent of the economies studied score below average in critical areas such as ecosystem participation, skills, and research and development.
“India’s journey to becoming an AI contender underscores the nation’s emphasis on integrating technology into high-priority sectors like agriculture, education, and healthcare. As one of the top 10 countries in AI readiness, India holds immense potential for public sector transformation through AI,” said Saibal Chakraborty, India Leader, Technology and Digital Advantage Practice, BCG.
“India ranks second globally in AI specialists and 3rd in research publications, with a strong base in AI-related patents,” he added.
The report further showed that AI exposure spans several key sectors in India. Business services account for 16 per cent of GDP and have significant AI exposure, with potential improvements in administrative efficiency for government operations.
Retail and wholesale make up 10 per cent of GDP, where AI could streamline public distribution and supply chain management, reducing wastage. Public services represent 6 per cent of GDP, with opportunities for AI to enhance service delivery and emergency response.
Agriculture, forestry, and fisheries contribute 17 per cent of GDP and could use AI in precision farming and risk assessment to boost productivity.
The construction sector, at 8 per cent of GDP, can utilise AI for infrastructure planning and asset maintenance. Arts, recreation, and personal services, also at 8 per cent, could benefit from AI in managing public facilities.
“Realising this potential requires a multi-faceted approach: strengthening infrastructure, enhancing AI research capabilities, and expanding workforce training. Investments in research hubs, cloud capabilities, and data systems are critical, alongside efforts to expand AI education in rural areas and foster public-private collaborations,” Chakraborty said.
The report also called for regulatory frameworks to address the ethical use of AI, monitor bias, and ensure responsible adoption of the technology.
Aparna Bharadwaj, managing director, BCG urged “policymakers to act decisively to prepare for an AI-driven world”. This can be achieved by “enhancing resilience, productivity, job creation, modernisation, and competitiveness”.
