India’s artificial intelligence (AI) and generative AI (GenAI) market is expanding at one of the fastest rates globally, but the country is facing an acute shortage of skilled professionals to sustain this growth. A series of recent reports have revealed a widening talent gap, underscoring the paradox of rising investment in GenAI capabilities alongside a shortage of qualified engineers.
According to the latest India Digital Skills Report 2025, for every 10 roles in GenAI and AI engineering, only one qualified professional is available. This mismatch highlights the urgent need for workforce upskilling, particularly as enterprises ramp up adoption of AI in areas such as customer engagement, product design, financial services, and healthcare.
The Growing Adoption of GenAI
India has emerged as one of the largest user bases of generative AI tools. Surveys by industry trackers show that adoption rates among Indian professionals are significantly higher compared to global peers, with strong traction among students, startups, and enterprises. From text and code generation to image creation and predictive analytics, GenAI is being embraced across diverse sectors.
Large enterprises including Tata Consultancy Services, Infosys, and Wipro are investing heavily in GenAI projects. Similarly, startups are deploying AI agents to solve problems ranging from logistics optimization to marketing automation. Analysts project India’s GenAI market to cross USD 17 billion by 2030, making it a core driver of digital transformation.
Yet, the speed of adoption is colliding with the reality of limited talent supply.
A Severe Skills Gap
While demand is soaring, the supply of skilled engineers is constrained. Data indicates that only one in 10 open GenAI positions is currently being filled by qualified candidates. Companies are struggling to find engineers proficient in areas such as large language model (LLM) training, reinforcement learning, prompt engineering, and applied AI ethics.
This shortage is not due to lack of interest. India has one of the largest pools of engineering graduates globally, but most lack specialized AI training. The All India Council for Technical Education (AICTE) estimates that less than 3 percent of computer science graduates are industry-ready for advanced AI roles.
Rising Compensation and Demand
The shortage has also created a surge in compensation levels. Recruiters report that salaries for GenAI specialists in India have increased by 40 to 50 percent in the past year, with top engineers earning packages exceeding those in traditional IT services. Roles in machine learning operations (MLOps), data engineering, and AI product management are witnessing the steepest hikes.
Companies are increasingly looking abroad to fill these roles, while also investing in internal training programs to bridge the gap. According to recruitment agencies, multinational corporations with AI hubs in India are offering global-level compensation to retain top talent.
Industry and Academia Response
Recognizing the challenge, both industry and academia are stepping in. Educational institutions are adding specialized AI courses, while companies are collaborating with universities to create AI-ready curriculums. Initiatives such as the Digital India Future Skills Program are being expanded to provide hands-on AI training to students and young professionals.
Global players are also contributing. Partnerships between OpenAI, Google, and Indian institutes have introduced programs for practical AI training. Meanwhile, domestic edtech platforms like upGrad and Great Learning are scaling AI certification courses aimed at professionals seeking to transition into GenAI roles.
The Broader Impact
If left unaddressed, the skills shortage could slow India’s ambitions to become a global AI powerhouse. Analysts warn that while India’s cost advantage and talent scale remain attractive, lack of specialized skills could push companies to shift more complex AI work abroad.
On the other hand, this shortfall also presents an opportunity. Experts argue that India is at an inflection point similar to the IT services boom of the 1990s. By investing in large-scale skilling initiatives now, the country could position itself as the world’s largest GenAI talent hub in the coming decade.
The Road Ahead
The consensus among policymakers and industry leaders is clear: upskilling, reskilling, and curriculum redesign are the only long-term solutions. Short-term fixes such as salary inflation and global hiring may plug immediate gaps, but building sustainable GenAI capacity will require structural reforms.
With India’s youth accounting for over 60 percent of its population, the demographic dividend could still be converted into a GenAI dividend. If educational institutions, private companies, and government programs align effectively, the shortage could turn into an opportunity for leadership in the global AI economy.
For now, the imbalance remains stark. The country has the appetite and demand for GenAI, but not yet the engineers to power it at scale. How quickly India addresses this gap will determine whether it emerges as a true AI superpower or risks losing momentum in one of the defining technology shifts of the decade.