AI key to achieving 8% economic growth: India’s NITI Aayog
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Homepage > News > Business > AI key to achieving 8% economic growth: India’s NITI Aayog India’s NITI Aayog, the central public policy think tank of the government, said that artificial intelligence (AI) stands out as a key driver for achieving the goal of Viksit Bharat (self-reliant India) and sustaining an annual economic growth rate of 8%. NITI Aayog added that the world’s fastest-growing major economy could unlock an additional $500–600 billion in gross domestic product (GDP) by 2035, surpassing its current growth path. In its latest report, the think tank’s assessment shows that the manufacturing and financial services sectors would be most influenced and may have as much as 20-25% of their sectoral GDP credited to AI by 2035. “If India is to accelerate its growth to the 8% annual rate required for the realization of Viksit Bharat, we have no option but to significantly raise productivity across the economy and unlock new growth through innovation. Artificial Intelligence can be the decisive lever,” BVR Subrahmanyam, the chief executive of NITI Aayog, said in the report. “With a focused and sector-specific approach, industries such as banking and manufacturing can deploy Al today to improve efficiency, service quality, and competitiveness creating momentum for deeper transformation. At the same time, India must nurture frontier innovation, from Al-enabled drug discovery to software-defined vehicles, building the next engines of growth,” Subrahmanyam added. NITI Aayog, in its report, pointed out two key AI-driven accelerators. First, extensive integration of AI across economic sectors can significantly improve productivity and workflow optimization, addressing as much as 30–35% of the required growth gap. Second, redesigning research and development (R&D) through generative AI would allow India to move forward in global innovation, contributing an additional 20–30% of the essential improvement. Moreover, sectors like manufacturing and banking can deploy AI immediately to improve service quality, enhance workflows, and elevate international competitiveness, thereby influencing a broader transformation. At the same time, the report stated that India needs to invest in various innovations, from AI-facilitated drug discovery to intelligent, software-enabled vehicles, to develop the next high-growth industries. This extensive evaluation, commissioned by NITI Aayog, reinforces the potential of AI in raising India’s economic growth path. The study covered over 850 occupations across 16 sectors and reviewed over 2,100 distinct work activities to discern AI’s impact on efficiency and performance. “The…
Filed under: News - @ October 1, 2025 1:24 pm