AI Adoption in Indian Enterprises

Indian enterprises are advancing significantly in the adoption of artificial intelligence (AI), with a pronounced focus on long-term investments and open-source technologies, as revealed by a recent study commissioned by IBM. The report notes that 87% of IT decision-makers (ITDMs) in India have made considerable progress in realising their AI strategies for 2024, while 76% have reported achieving a return on investment (ROI) from their AI projects.

Commitment to AI Innovation

The research, which was carried out by Morning Consult in partnership with Lopez Research, highlights a strong commitment to AI innovation within India, with 93% of businesses planning to heighten their AI investments in 2025. Furthermore, an impressive 71% of organisations in India are anticipated to utilise open-source ecosystems to maximise the effectiveness of their AI implementations.

Investment Insights

The findings of the report indicate that 97% of participating organisations plan to either bolster or sustain their AI investments in 2025. The main areas of concentrate include:

• IT operations (83%)
• Software development (56%)
• Data quality management (55%)

Strategic Changes for AI Maximisation

To fully harness the advantages of AI, companies are prioritising strategic modifications, such as:

• Heightened adoption of open-source tools (71%)
• Utilisation of managed cloud services (70%)
• Recruitment of specialised AI expertise (66%)

Barriers to AI Implementation

Despite the enthusiasm surrounding AI, the study points out notable obstacles to its implementation. The primary challenges faced by Indian companies include:

• Lack of AI governance frameworks (53%)
• Shortage of AI expertise (51%)
• Technology integration issues (51%)
• Data management difficulties (41%)
• Inability to deliver business value (39%)

Sandip Patel, Managing Director at IBM India & South Asia, stated that India is quickly adopting AI with a distinct focus on fostering innovation and securing ROI. The increasing utilisation of open-source AI tools is vital for enhancing productivity and financial results. However, it is essential that this technology is employed wisely to scale its implementation.

Shift Towards Open-Source AI Solutions

The study suggests a clear trend towards open-source AI solutions in India. Approximately 48% of Indian enterprises indicate that more than half of their AI solutions are grounded in open-source technologies. This preference for open-source AI tools is notably prominent among larger firms, which are progressively embracing these solutions to improve flexibility and foster innovation.

Alternative Success Metrics

While 76% of Indian companies have reported achieving a positive ROI from their AI initiatives, the study reveals that many organisations are also concentrating on alternative metrics for success. The most common measures for assessing AI efficacy include:

• Accelerated software development (34%)
• Rapid innovation (32%)
• Productivity enhancements (17%)
• Direct cost savings (11%)

Future Expectations for AI Success

Among organisations that have not yet experienced positive returns, 33% anticipate achieving cost savings within the next 12 months, and all surveyed companies believe they will realise ROI from their AI investments within three years.

Maribel Lopez from Lopez Research noted that as organisations begin to implement AI on a larger scale, there is an increasing emphasis on metrics such as productivity improvements, partly because traditional hard-dollar ROI metrics have not yet reflected significantly in financial statements. Nevertheless, organisations continue to make rapid advancements in their AI strategies, showing no sign of deceleration. There is a growing recognition of the importance of defining specific use cases and refining AI projects, with businesses actively employing hybrid cloud strategies and open-source solutions to foster AI innovation and achieve financial gains.