India Targets $1.7 Trillion AI Boost with New Industry Consultation and Semiconductor Funding

MeitY convened an industry consultation on “Supporting AI Transformation of the IT Services Industry,” the press release notes, gathering major software firms and startups to discuss policy, skill gaps, and incentives needed for large‑scale AI adoption across Indian tech services.

Government analysts project that artificial intelligence could add roughly $1.7 trillion to India’s economy by 2035, a figure that represents a sizable share of projected GDP growth and underscores AI’s role in driving productivity and export competitiveness.

Budget 2026 documents reveal a recalibrated tech spend where semiconductors receive a major boost, aiming to develop domestic chip design and manufacturing capacity that will supply the processing power essential for AI applications and reduce import dependence.

Industry leaders expect these coordinated steps to create thousands of high‑skill jobs, attract foreign investment in AI and chip sectors, and position India among the top three global AI economies within the next decade.