India’s AI boom: Surprising insights from India’s AI adoption

India is set to develop its own AI model, similar to ChatGPT, as part of the India AI Mission. The goal is to create a powerful, cost-effective AI tool with a computation cost of just ₹100 per hour, significantly lower than the global average of ₹200+ per hour.

Computation cost refers to the expense required to run a unit of AI application, and reducing this cost will make AI more accessible and scalable in India.

Why is this important? Because AI is not just a passing trend—it is rapidly becoming the backbone of businesses, education, and technology. From entrepreneurs to students to coders, AI is transforming how India works, learns, and innovates. And with this mission, India is taking a crucial step toward reducing dependence on Silicon Valley and building its own AI-powered future.

In this article, we look at some surprising insights about India’s current AI usage.

Indians use AI more than anyone else

• India is the largest market for ChatGPT with 46% of consumers survyed using this AI tool as per BCG survey, with millions of daily active users leveraging AI for learning, work, and business.

• The country’s high engagement with AI-driven chatbots, coding assistants, and generative AI models showcases a strong willingness to embrace digital transformation.

• India is being followed by some interesting companies where ChatGPT is popular i.e. Morocco, UAE, Argentina, Brazil, and Indonesia.

AI-related app downloads are soaring, India is leading

India has the highest recorded 3 billion AI-related app downloads in 2024 (apps which mentioned AI in their title, subtitle, and description on App Store and play stores), twice that of the US (1.5 billion) and more than China (1.3 billion). Some of the most common AI developed by Indians are ChatGPT, Gemini, Microsoft Copilot etc.

India’s AI app spending is growing exponentially

• Indian consumers are spending more on AI-powered applications, signalling an increased willingness to pay for premium AI services (subscription and in-app purchases).

• India witnessed more than 100% YoY growth in in-app purchases of AI-related apps over the period 2021-2024.

• In-app purchases means a ChatGPT subscription or a Canva Premium or any AI app’s premium subscription.

Source: State of Mobile Report 2024

As AI continues to shape the future of work and education, India's leadership in AI adoption is expected to deepen.

Okay, so Indians are way ahead when it comes to AI adoption we are a leader in ChatGPT users, our AI app downloads are the highest in the world and our spend on AI apps is increasing exponentially. Now let’s talk about what it means for business

India’s AI startup boom: a rapidly expanding ecosystem

India is witnessing an unprecedented surge in AI startup activity, emerging as a major global hub for AI-driven innovation. The country’s GenAI startup base has grown ~2.5x since 2023, reflecting a thriving entrepreneurial ecosystem supported by increasing funding and global interest. The chart shows the global split of AI startups as a % of total global AI startups.

AI startup growth trends

• India now accounts for 20% of all GenAI startups worldwide, up from just 9% in 2023.
• $760 million has been invested in Indian GenAI startups since 2023, demonstrating strong investor confidence in the sector.
• 3 out of 4 AI startups in India are now revenue-generating, signalling rapid commercialisation and adoption of AI solutions.

This explosive growth positions India as a key player in the global AI landscape. As innovation accelerates, India's AI sector is set to drive significant economic and technological advancements. As per the Inc 42 report, the GenAI industry is set to become $17bn by 2030 from its current size of $1.1 bn in 2023 - a multifold growth of 16x is expected.

The bottom line

India’s AI revolution and the rise of its internet economy are setting new benchmarks in global digital adoption. With AI becoming an integral part of daily life and the internet economy expanding across sectors, the next decade will redefine how businesses and consumers interact in the world’s fastest-growing digital market.