India AI market to reach $7.8B by 2025: IDC
The artificial intelligence (AI) market in India is expected to grow at a five-year compound annual growth rate (CAGR) of 20.2 percent and touch $7.8 billion in total revenues by 2025, according to research firm IDC.
Businesses in India will accelerate the adoption of both AI-centric and AI non-centric applications for the next five years, IDC said in a statement.
The AI software segment is expected to dominate the market and grow from $2.8 billion in 2020 at a CAGR of 18.1 percent by the end of 2025, IDC said.
Organisations are leveraging multiple AI applications such as CRM, ERM, and others to manage operations, scale supply chains in response to real-time or predicted demands and many more to provide benefits for their customers, improve RoI (return on investments) and achieve cost savings, it added.
"Indian organisations plan to invest in AI to address current business scenarios across functions, such as customer service, human resources (HR), IT automation, security, recommendations, and many more. Increasing business resilience and enhancing customer retention are among the top business objectives for using AI by Indian enterprises," IDC India Associate Research Director (Cloud and AI) Rishu Sharma said.
"Increasing business resilience and enhancing customer retention are among the top business objectives for using AI by Indian enterprises," Sharma added.
Indian organisations cited cloud as the preferred deployment location for their AI/ML solutions. About 51 percent of organisations are processing transactional and social media data through AI/ML solutions in the country.
"With data being one of the most crucial components in an AI/ML project, businesses use variety of databases to handle large data volumes for making real time business decisions. Organisations must focus on getting high-quality training data for AI/ML models," AI Senior Market Analyst, Swapnil Shende said.
AI applications forms the largest share of revenue for the AI software category, at more than 52 percent in 2020.
"The major reasons for AI projects to fail includes disruptive results to current business processes and lack of follow-ups from business units," the report noted.