45% of Indian Firms Still at Early AI Stage, Falling Behind Global Peers: Deel Report

Artificial intelligence may dominate corporate conversations across the country, but true adoption remains uneven. A new IDC InfoBrief, “AI at Work: The Role of AI in the Global Workforce,” commissioned by Deel, reveals that India continues to lag behind global peers in AI maturity despite growing interest and early deployment across sectors.

According to the study, 45% of Indian organisations are still in the early stage of AI adoption, the highest globally. A further 38% fall in the intermediate bracket, while only 17% have achieved advanced maturity, where AI is integrated into core business processes.

The report is based on a survey of 5,500 business leaders across 22 markets and highlights a widening gap between technological advancement and workforce preparedness. Only 54% of Indian firms have structured reskilling programmes, compared with 67% globally, signalling an urgent need for future-ready training.

AI Use in HR Rising, but Structural Challenges Persist

Within HR functions, AI adoption in India is strongest in talent management (66%) and talent acquisition (57%). However, the increased use of AI in repetitive and knowledge-based tasks brings new challenges around workforce integration, talent development, and leadership pipelines.

Key barriers to AI adoption include:

• Data privacy and compliance concerns (46%)
• Integration issues with legacy systems (45%)
• Lack of internal AI expertise (43%)

“AI is no longer emerging, it’s fully here,” said Nick Catino, Global Head of Policy at Deel. “It’s reshaping how we work and how businesses operate. Entry-level jobs are changing, and the skills companies look for are too. Both workers and businesses need to adapt quickly. This isn’t about staying competitive, it’s about staying viable.”

Workforce Redesign Accelerates

The report notes that 91% of organisations globally have experienced some level of role change or displacement due to AI. In India, 43% of companies say job roles have been significantly or fully redesigned.

Around 70% of Indian organisations expect a decline in entry-level hiring over the next 1-3 years, owing to automation and increased AI-driven workflows.

When hiring entry-level talent, employers now prioritise:

• Technical certifications (66%)
• Problem-solving skills (58%)
• Communication and collaboration (52%)

Only 5% consider a university degree a top hiring criterion.

India’s Reskilling and Talent Gap Widens

Despite having one of the world’s largest tech workforces, India faces a significant talent shortage in AI roles:

• 63% of organisations struggle to hire qualified AI professionals
• 61% say awareness of AI-related roles remains low
• Firms are willing to pay salary premiums:
  • 41% offer up to 25% more
  • 36% offer 25–50% more

To retain AI talent, companies are increasingly offering access to advanced tools (48%) and clear growth pathways (44%).

However, budget constraints (49%), limited employee engagement (58%), and a shortage of expert trainers (45%) continue to slow reskilling efforts.

Governance Gaps Remain a Major Hurdle

The report highlights significant uncertainty around AI regulation in India:

• 53% of organisations are unfamiliar with local AI laws
• Only 16% have formally implemented internal AI usage policies
• Top policy focus areas include data privacy/security (81%), accuracy and validation (70%), and content/copyright (60%)

“Artificial intelligence is reshaping the global workforce at an unprecedented pace, outstripping any recent technological shift,” said Dr Chris Marshall, Vice President for AI in Asia Pacific, IDC. “Organisations that will thrive are those that unite automation with a human-centred vision – investing in upskilling, redefining entry-level opportunities, and ensuring that governance and ethics evolve in step with innovation.”

India is also emerging as a key global hub for AI hiring, with 82% of international firms sourcing talent from South Asia. The report suggests that India stands to benefit significantly from this trend if it can close its skills and governance gaps.

Summary of Key India Findings

AI Adoption:

• 45% struggle with integrating AI into existing systems
• 43% cite lack of expertise
• 46% express concerns around privacy and compliance
• Budget limitations remain for 37%

AI in HR:

• High adoption in talent management (66%) and recruitment (57%)
• Widespread use in employee experience, benefits, payroll, and compliance

Hiring & Pay:

• 36% hired AI specialists last year
• Strong demand for South Asian talent
• High salary premiums for skilled AI roles

Reskilling:

• Only 22% have company-wide AI reskilling initiatives
• Engagement, budgets, and trainers remain key challenges

Governance:

• Low familiarity with AI regulation
• Policy clarity remains limited at a national level