CONTEXT:The recently published third edition of the State of India’s Digital Economy (SIDE) 2025 report underscores India’s growing prominence in the realm of global digitalisation. However, it also points out critical deficiencies that must be rectified in order to effectively compete in the international artificial intelligence arena.
India’s Digital Economy Report (SIDE)
Published by:
- Dutch investment firm Prosus, in collaboration with the Indian Council for Research on International Economic Relations (ICRIER).
Report Framework:
- The SIDE 2025 report uses the Connect-Harness-Innovate-Protect-Sustain (CHIPS) framework to evaluate digitalization in India and other nations.
- This framework emphasizes the importance of not just technological infrastructure but also the societal, economic, and policy dimensions of digital transformation.
Key Insights from the Report
Global Overview:
- The United States and China currently lead the global competition in artificial intelligence (AI).
- South Korea, Singapore, and the Netherlands are emerging as significant contenders in the AI space.
India-Specific Insights:
- India ranks as follows among 32 nations (17 developed and 15 developing countries):
- 11th in AI Research
- 16th in AI Infrastructure
- India is recognized as the third-largest digitized nation globally, trailing only the United States and China.
- When assessing both country-level and user-level digitalization, India ranks 8th within the G32 cohort.
- While India has a large user base and high digital engagement, the average user exhibits only moderate levels of digitalization.
- Despite increased accessibility to digital services, adoption and influence remain limited across various demographic segments.
- India has significant potential to challenge the dominance of the United States and China in AI.
- By investing more in AI research, infrastructure, and strategic policies, India can enhance its competitive edge and scale up to rival leading AI powers.
- India ranks as follows among 32 nations (17 developed and 15 developing countries):