A recent EY report highlights that generative AI is poised to contribute 22-26% to the gross value added (GVA) in the Indian financial sector by 2030, potentially adding US$66-80 billion. 

The study, focusing on India, underscores the financial industry’s transformative surge driven by generative AI, with 78% of respondents having implemented or planning to pilot generative AI within the next year.

Despite this positive momentum, financial organizations face challenges related to increased regulatory scrutiny on governance and standards for large language model development. India’s robust economic growth, recognized by global institutions, positions it as the fastest-growing major economy, with projections to become the third-largest economy by 2027.

EY’s additional report “India@100: Realizing the Potential of a $26 Trillion Economy” forecasts India’s economy reaching US$ 26 trillion by 2047-48, achieving a per capita income of $15,000, comparable to developed countries. The study anticipates a significant GDP boost, projecting a potential addition of US$359-438 billion in the fiscal year 2029-30, reflecting a 5.9-7.2% increase.

Which sectors will be affected most?

Sectors like business services, financial services, transportation, logistics, education, retail trade, and healthcare are expected to contribute approximately 69% to the overall economic impact. Generative AI adoption in India is predicted to enhance the retail sector’s profitability by 20% by 2025.