AI could add $550 billion to India’s economy by 2035: PwC report

Artificial intelligence could add around $550 billion to India’s economy by 2035, with significant gains expected across sectors such as agriculture, healthcare, energy, education and manufacturing, according to a report by consulting firm PwC.

The report, titled AI Edge for Viksit Bharat, was launched last week at the World Economic Forum in Davos. It estimated that AI alone could contribute nearly $550 billion to five priority sectors by 2035 in nominal terms. PwC stated that India has the potential to emerge as a global example of how developing economies can deploy AI in a way that is both transformative and equitable.

Agriculture was described as the backbone of India’s economy, with the report stating that in order to achieve the goals of Viksit Bharat, the sector’s gross value added would need to rise sharply from about $637 billion in FY25 to nearly $2,359 billion by FY47.

However, the sector continues to face major productivity challenges. PwC informed that around 86 per cent of Indian farmers are small or marginal farmers, owning less than one hectare of land. It stressed that faster adoption of digital tools, particularly AI, is critical to improving productivity and ensuring long-term sustainability in farming.

The energy sector was identified as a key enabler of growth for both manufacturing and agriculture. PwC stated that an efficient and productive energy system is essential for meeting Viksit Bharat objectives, as it underpins industrial expansion and modern agricultural practices.

In healthcare, the report said expanding tertiary and super-speciality care through medical colleges linked to district hospitals could generate high-skill employment and help retain medical talent. It added that such expansion could boost medical tourism and make advanced treatment more accessible beyond major cities, with AI supporting improved diagnosis and operational efficiency.

For manufacturing, PwC highlighted sectors including semiconductors, solar panels, telecommunications and electronics. The report stated that accelerated growth in these areas, backed by AI and digital technologies, could strengthen Aatmanirbhar Bharat and deepen India’s integration into global value chains.

The report also noted that AI has the potential to improve education quality, governance and skill alignment, thereby enhancing employability outcomes for students.

PwC further outlined the AI Edge framework, which sets out five outcomes expected from large-scale AI adoption in India, including operational excellence, sustainability, good governance, resilience and financial discipline.

The report introduced the 3A2I framework, aimed at making AI a connected system for India’s development. It focuses on building access to data, infrastructure and skills, creating acceptance through trust, transparency and ethical safeguards, and enabling assimilation by embedding AI into real-world processes.