New Delhi— India has emerged as the world’s fifth most digitalised economy and ranks fourth globally in artificial intelligence performance, according to the State of India’s Digital Economy (SIDE) 2026 report released on Friday by the ICRIER-Prosus Centre for Internet and Digital Economy (IPCIDE).
The report, based on benchmarks across 71 countries, stated that India has overtaken advanced economies such as Germany, France, Japan, the United Kingdom and Canada in the global AI race.
According to the findings, India is ranked fourth on the CHIPS-AI index, behind only the United States, China and Singapore, highlighting the country’s rapid emergence as a major AI-driven economy.
The report also pointed to a major shift in the global digital landscape, stating that 72 per cent of AI users are now located in developing countries. India and China together account for nearly two-fifths of worldwide AI adoption.
India generated USD 328 billion in digitally delivered trade and is home to the world’s second-largest pool of AI talent, the report said.
It further observed that generative AI spread faster than any previous technology in history and became widely adopted in developing countries almost immediately after its launch.
The report described the trend as a “structural shift” in global digital leadership.
“Among the world’s top five digital economies, three — China, Singapore and India — are now from the Indo-Pacific region, signalling the emergence of a tripolar digital order alongside the traditional North Atlantic pole,” the report noted.
India climbed to the fifth position in global digital economy rankings from eighth place in 2025, reflecting accelerating digital growth in an increasingly competitive global environment.
ICRIER Chairperson Pramod Bhasin said India has built strong foundations through connectivity expansion, entrepreneurship and digital public infrastructure. He added that the next stage of growth would depend on leveraging AI effectively, strengthening innovation capabilities and building digital trust.
Sehraj Singh, Vice President for Group Corporate Affairs and Public Policy at Prosus, said India is no longer merely a large digital market but is increasingly becoming one of the world’s most influential AI economies.
The report underscores India’s growing role in shaping the future global digital and artificial intelligence ecosystem, particularly within the developing world.
