Indian enterprises are accelerating generative AI deployment, with 47% now running multiple GenAI use cases in production, even as spending remains tightly capped, according to the EY-Confederationof Indian Industry (CII) report. Another 23% of organizations are still in the pilot stage, signalling a shift from experimentation to operational use. Some 76% of Indian business leaders foresee a significant business impact with the deployment of GenAI.

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Budget caution: Over 95% of surveyed organizations allocate under 20% of their IT budgets to AI and machine learning, while only about 4% spend over that threshold, according to the report. The survey covered 200 organizations across 20+ industries, including government bodies, Indian subsidiaries of multinationals, startups, and global capability centers.

Focus areas: Over the next 12 months, firms expect to channel most AI spending toward operations, where 63% foresee increased investment, followed by customer service at 54% and marketing at 33%. These functions are seen as offering faster returns through automation, workflow simplification, and productivity gains, according to the report.

Deployment model: Nearly 91% of decision-makers said deployment speed is the most important factor in deciding whether to buy or build AI tools. Most organizations are relying on hybrid implementation models that combine internal teams with external vendors, cloud providers, and co-innovation partners.

Workforce shift: Companies are also reporting changes in job roles linked to standardized and repeatable tasks, with 64% seeing early signs of role transformation. The survey says organizations are beginning to adopt a “new workforce pyramid” as AI reshapes task distribution and skill requirements. A talent shortage persists, with 59% citing difficulty in hiring skilled AI professionals.

IN CONTEXT- India’s digital economy was valued at INR 28.94 tn (USD 368 bn) in 2022/23, government estimates show. India’s IT spending is expected to reach USD 160 bn in 2025, ETTelecom reports, citing a Deloitte estimate. As GenAI adoption rises faster than IT budgets, firms are prioritizing targeted deployments with clearer returns over company-wide rollouts.

WANT TO NERD-OUT OVER AI? Go play with Google’s new Gemini 3.0 model, released last night. It’s giving fits to Anthropic and OpenAI, with benchmarks suggesting it edges out the latter’s popular (and cutting edge) 5.1 model — for now, at least.

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