AI May Add $1.7 Trillion to India’s Economy by 2035

Artificial Intelligence (AI) is set to emerge as one of India’s biggest economic growth engines, with the potential to add up to $1.7 trillion to the economy by 2035, according to government estimates released in a year-ender note on Tuesday.

The projection comes as India significantly scales up public investment and policy support for AI through the IndiaAI Mission, which has been allocated over ₹10,300 crore for five years. 

The mission focuses on building national AI computing infrastructure, supporting startups, developing indigenous AI models, and expanding large-scale skilling and reskilling programmes.

Government officials said the economic boost will be driven by rapid AI adoption across sectors such as healthcare, agriculture, manufacturing, financial services, education, governance, and climate services, where automation and data-driven decision-making are already improving productivity and service delivery.

India’s technology sector currently employs more than six million people, and government data suggests that while AI will transform existing roles, it will also create entirely new categories of jobs. 

Industry estimates indicate India’s AI talent pool could more than double to over 12.5 lakh professionals by 2027, reflecting rising demand for skills in data science, AI engineering, and advanced analytics.

To address this demand, the government has launched large-scale reskilling initiatives. According to official figures, over 18.5 lakh candidates have enrolled on the FutureSkills PRIME platform, with more than 3.37 lakh professionals already completing courses in AI and other emerging technologies.

A key pillar of India’s AI strategy is the creation of affordable and accessible computing infrastructure. Under the IndiaAI Mission, GPU capacity has been expanded from an initial target of 10,000 GPUs to 38,000 GPUs, which are being made available to startups and researchers at subsidised rates. Officials say this move will lower entry barriers for innovation and accelerate domestic AI development.

The government is also emphasising inclusion, with AI tools being rolled out in Indian languages to broaden access to digital services. Platforms such as Bhashini and BharatGen, the government-funded multilingual AI model, aim to ensure AI benefits reach beyond urban, English-speaking users.

Separately, NITI Aayog has highlighted AI’s potential to support India’s 490 million informal workers, particularly through voice-based and mobile-first technologies that can improve access to skilling, healthcare, financial services, and real-time advisory tools.

Taken together, officials say these efforts position AI not just as a technology upgrade, but as a foundational pillar of India’s long-term economic and social transformation.