India’s AI ambition risks outrunning its readiness

India has been clear about not just participating in the artificial intelligence (AI) revolution but also shaping it.

- Lloyd Mathias Gaurav Bhagowati

The AI Impact Summit earlier this year was evidence of this.But, two global indices released within weeks of the summit, taken together, offer a more sobering reality check. The Oxford Insights Government AI Readiness Index 2025 ranks India 27th globally, reflecting middling performance on governance, regulatory quality, and public-sector capability. In contrast, the 2025 Stanford University Global AI Vibrancy Index places India among the world’s top three AI ecosystems, citing strengths in talent, research output, digital infrastructure, and startup dynamism.

The two rankings reveal a structural imbalance: India’s AI market is sprinting ahead, while its institutions are still catching up. This divergence is not accidental. Over the past decade, India made a deliberate strategic bet on building population-scale digital infrastructure. This foundation now enables AI applications to scale faster than in most large economies. It is this ecosystem that the Stanford index celebrates. India has a deep pool of technical talent, a large and diverse deployment market, and a startup sector that is both energetic and increasingly well-funded.