India’s AI spending to grow 38% annually, set to reach $10.4 bn by 2028: Report

India’s adoption of artificial intelligence is accelerating, with AI technology spending expected to grow at an annual rate of 38% from 2023 and reach $10.4 billion by 2028, according to new International Data Corporation data.

The growth is being driven largely by the rise of agentic AI. More than 90% of Indian organisations are expected to use AI agents in the next year, signaling a shift from experimentation to large-scale deployment.

Commenting on the findings, Deb Deep Sengupta, Area Vice President, South Asia, UiPath, said, “The paradigm shift to agentic AI in India is accelerating. Enterprises are increasingly looking to leverage agentic automation workflows and deploy AI agents to improve productivity, efficiency, and business growth. In 2026, companies that succeed with AI won’t be the ones with the flashiest pilots. They’ll be the ones with the best deployment strategy to orchestrate people, processes, and technology together, all in a framework that’s well-governed and trustworthy

UiPath's special report outlines six trends shaping AI adoption across India and the broader Asia-Pacific and Japan (APJ) region.

APJ’s growing role in global AI

The region is emerging as a major exporter of AI innovation. India is becoming a central R&D hub, supported by its developer base and more than 1,950 Global Capability Centers, many of which now build AI solutions for global markets. Southeast Asian markets such as Singapore and Vietnam are also acting as testing grounds for AI-first applications, while China, Taiwan and Japan continue to anchor global advancement through patents, chips and research.

Push for measurable returns

More than 50% of APJ organisations are reallocating funds to boost AI investment, with 29% already planning deployments of AI agents within two years. Companies are demanding 2-4x returns within 12 to 18 months, prompting stricter evaluation of AI outcomes.

AI’s shift from cost savings to growth

Organisations across the region are moving beyond efficiency gains to using AI for revenue-generating opportunities. Financial services firms are applying agentic AI in loan processing and claims validation, while manufacturers are deploying it to manage supply chains and production.

Orchestration seen as critical

Over 70% of APJ firms say orchestration of AI agents, automation tools, and human workers will provide a competitive advantage. The firm report cites healthcare firms in India using orchestrated workflows to speed up tasks such as denial management and payment posting.

Trust as a foundation

Countries across APJ are rolling out frameworks to promote responsible AI. Japan’s AI Promotion Act, Australia’s Voluntary AI Safety Standard and the ASEAN Guide on AI Governance reflect the growing emphasis on ethics, security, and transparency.

Rise of the agentic workforce

Workplace roles are shifting as AI systems assume planning and decision-making functions. According to the World Economic Forum, 86% of employers expect AI to reshape their business by 2030. By 2040, Japan alone will require 4.98 million workers with AI and robotics expertise.

The report concludes that India is moving from being a fast adopter to becoming a creator and exporter of AI innovation. Enterprise deployment is shifting toward value-based outcomes, supported by a growing talent base and an expanding GCC ecosystem.

India’s position in global AI development, the report notes, ensures the country “doesn’t just participate in the AI revolution - it helps define its direction.”