Artificial Intelligence (AI) is no longer a fringe technology in India, according to Bain & Company, with proof that 80 percent of enterprises possess at least one AI model in production.

Companies in India have showcased a significant uptick in interest towards adopting AI to drive business outcomes. However, there is plenty of hype and hyperbole about what constitutes AI, since it was observed that companies are not hesitant in making AI claims around systems that are rules-based.

For example, fintech players have been able to reduce fraudulent transactions by up to 40 percent, pharmaceutical manufacturing companies reduced reject rates by up to 20 percent and D2C companies have seen enhancement in conversion rates by two to three percent through personalization. Such organizations spend ~0.4 percent –0.7 percent of their revenues on AI/ ML and realize an ROI of about 2–4x,” claims Sudheer Narayan, Partner, Bain & Company and co-author of the report.

The study indicates that the thrust in AI adoption among enterprises is the highest in communication, over-the-top (OTT) and gaming (55 percent); technology (48 percent); and financial services (39 percent) sectors. Over 90 percent of digital native companies across CPG & Retail and financial services have shown AI/Machine Learning adoption.

India may hold a small share in the global market, yet it appears to produce 16 percent of global AI talent which positions it among the top three contributors in the world. It is believed that the quantity of talent in India will prosper with a clear distinction between engineers, data scientists and product managers.

For the next three years, 49 percent of enterprises indicate growth in the proportion of ‘build’, compared to 29 percent that plan to increase the proportion of ‘buy’. The study shows that providers will also be inclined towards building their models using third-party support or open source tools and services.

89 percent of enterprises are believed to to increase annual AI spend around 10 percent.

94 percent of AI researchers and adopters indicate growth in the share of AI/ML-based applications in the next three years.

“While attribution of value to AI is challenging given the embedded nature of AI with the software, 85 percent of executives from early adopters feel it has driven substantial value. The level of value-added is consistently high, especially among the more mature organizations”, adds Narayan.