The integration of generative artificial intelligence (GenAI) into India’s IT industry is expected to boost productivity by 43% to 45% over the next five years, according to a report from consulting firm EY India. The report published on Monday said that this increase is attributed to the adoption of GenAI by IT companies and the transition of client projects from proof of concept to full-scale production.
Major Indian firms like Tata Consultancy Services and Infosys lead the way, with 89% of clients experimenting with GenAI and 33% already operationalising these projects. Other significant players, including HCLTech, Tech Mahindra, Wipro, and mid-sized firms like LTIMindtree and Happiest Minds, are also moving towards large-scale AI implementation.
Abhinav Johri, a technology consulting partner at EY India, noted that enterprises are advancing from experimentation to widespread AI adoption, reflecting growing confidence in its potential.
The survey indicates that software development roles will see the greatest productivity increase at 60%, followed by BPO services at 52% and IT consulting at 47%. These sectors are expected to contribute to 50% to 60% of overall productivity gains in tech services. Additionally, AI adoption is enhancing customer service, reducing costs, and driving revenue growth, the report noted.
The momentum behind GenAI adoption signifies a major shift in India’s technology landscape. Companies embracing AI-driven strategies are poised to achieve greater efficiency, improved decision-making, and enhanced competitiveness globally. With AI-powered automation streamlining operations, Indian enterprises are well-positioned for substantial growth and innovation.
In an earlier report published in January, EY India said that GenAI is slated to transform 38 million jobs by 2030, estimating that 24% of tasks across industries can be fully automated, while an additional 42% of tasks can be augmented with AI, freeing up 8–10 hours per week for knowledge workers.
A report from NTT DATA published today further highlights that as GenAI adoption increases, enterprises face new pressures regarding return on investment, particularly in the banking sector. While ROI is a priority for GenAI implementations, opinions on effective strategies are divided among banking leaders. Although GenAI offers potential solutions for productivity challenges, only half of banking leaders view it as a remedy. Cost optimisation also presents a divide, with nearly half seeking to reduce IT budgets, it said.
This trend is mirrored globally, where 59% of US banks aim to cut IT budgets, and 47% want to reduce operations budgets, while only 43% of European banks prioritise IT budgets and 36% are concerned about operations costs. Productivity is paramount for 46% of European banks, but the US and APAC banks emphasise productivity even more.
Experts caution that the widespread popularity of AI brings ethical risks. Both reports stress the need for responsible AI implementation, focusing on governance, ethical usage, and workforce reskilling.
As Johri said, “Scaling AI responsibly through robust infrastructure, governance, and talent development will be key to unlocking its full economic impact and strengthening India’s competitive edge in the digital era.”
This aligns with an Accenture report, released in August, which suggests that a responsible, people-centric approach to adopting GenAI could generate an additional $675 billion in economic value for India by 2038.
