New Delhi, Sep 8: Indian businesses are rapidly increasing their investment in artificial intelligence, but the pace of AI adoption is also highlighting the need for stronger governance, data management and security systems.
Enterprise AI investment in India grew 119 per cent in a year, significantly faster than the global growth rate of 110 per cent, according to the ServiceNow Enterprise AI Maturity Index 2026.
The strong investment reflects growing interest among companies in using AI to improve business operations, automate routine work and support faster decision-making. AI is also expected to account for more than one-fifth of the average IT budget of Indian enterprises by 2027.
However, businesses are still building the systems needed to manage AI safely. Only 22 per cent of Indian enterprises currently have processes for AI testing, auditing and risk assessment.
AI agents are already being used by 54 per cent of Indian organisations, but only 11 per cent have moved towards fully autonomous workflows. This suggests that companies are adopting AI while remaining cautious about allowing the technology to independently handle critical business decisions.
Data privacy, security, transparency and regulatory compliance are among the major concerns for businesses as AI becomes more deeply integrated into enterprise operations.
The study also found that 74 per cent of Indian organisations see data accuracy, access and management as areas that need improvement. More than half are also facing challenges in integrating AI with older technology systems.
AI currently accounts for around 16.6 per cent of the average IT budget in India, with that share expected to rise to 21.3 per cent by 2027. However, only 18 per cent of organisations have replaced fragmented legacy systems with integrated platforms.
The findings point to a changing phase in India’s AI journey. Businesses are moving beyond experimentation and investing more heavily in AI, but the next stage of growth will depend on building reliable data systems, stronger governance and clear safeguards around how AI is used.
With investment continuing to rise, Indian companies are increasingly focused not just on adopting AI, but on making it secure, responsible and useful for long-term business growth.