India has emerged as the world’s fifth most digitalised
economy in 2026, surpassing several advanced economies
including Germany, France, Japan and Canada, according to the
State of India’s Digital Economy Report 2026 released by the
Indian Council for Research on International Economic Relations
(ICRIER) and the Prosus Centre for Internet and Digital Economy
(IPCIDE).
The report also ranked India fourth globally in the Connect,
Harness, Innovate, Protect and Sustain (CHIPS) index for
artificial intelligence (AI), behind only the United States, China
and Singapore, reported Business Standard.
According to the report, India accounts for nearly 26 percent of
global AI users and possesses the world’s second-largest AI
talent pool. However, it noted that the country continues to lag in
areas such as private AI investment, computer infrastructure
and commercialisation capabilities.
“India’s long-term competitiveness depends on mobilising risk
capital, expanding computer access, strengthening university
startup linkages and building AI commercialisation pathways,”
the report stated.
The report observed that despite rapid global adoption of AI
technologies, advanced semiconductor chips, high-end compute
infrastructure and large language models remain concentrated
among a limited number of countries and companies.
It highlighted that strengthening domestic capabilities in AI
infrastructure and innovation ecosystems would be critical for
India to sustain its digital growth momentum and improve its
position in the global AI landscape.