India Places 4th in Global AI Performance, 5th in Digital Economy Index

India Rises as World's Fifth Most Digitalised Economy and Fourth in AI Performance

India has emerged as the world's fifth most digitalised economy and ranks fourth globally in AI performance, according to a report released on Friday by the ICRIER-Prosus Centre for Internet and Digital Economy (IPCIDE). The 71-country benchmarks reveal India outpaces Germany, France, Japan, the UK, and Canada in the AI race, with 72% of global AI users now in developing countries.

The report, part of the State of India's Digital Economy (SIDE) 2026 report, highlights India's significant progress in digital adoption. India has emerged as the fifth most digitalised economy and is placed fourth on the CHIPS-AI index. The country generated USD 328 billion in digitally delivered trade and is home to the world's second-largest AI talent pool.

A notable trend observed in the report is the rapid diffusion of Generative AI, which has become a developing-country phenomenon almost immediately after its launch. This phenomenon has led to a "structural shift" in global digital leadership, with India climbing to fifth in global rankings (eighth in 2025) as digital momentum accelerated in an increasingly competitive environment.

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The country's standalone AI index ranking of fourth validates its emergence as a global AI powerhouse. ICRIER Chairperson, Pramod Bhasin, stated that India has built strong foundations through connectivity, entrepreneurship, and digital public infrastructure. The next phase of growth depends on effectively leveraging AI, deepening innovation capabilities, and strengthening digital trust.

According to the report, India is no longer just a large digital market but is emerging as one of the world's most influential AI economies. Sehraj Singh, Vice President, Group Corporate Affairs and Public Policy, Prosus, noted that India's rise in digital adoption and AI performance positions it as a key player in the global digital landscape.

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