India Ranks 4th in AI Performance, 5th in Digital Economy

India ranked 4th globally in Artificial Intelligence performance and 5th in digital economy rankings in the State of India’s Digital Economy 2026 report. India improved its digital economy position from 8th in 2025 to 5th in 2026, and it stood behind the United States, China and Singapore in AI performance.

State of India’s Digital Economy 2026

The State of India’s Digital Economy 2026 report was released on 29 May 2026 by the ICRIER-Prosus Centre for Internet and Digital Economy. The report assessed India’s position across AI performance, digital trade, talent, and digital adoption indicators.

India’s AI Performance

India ranked 4th globally in AI performance and placed ahead of several developed economies, including Germany, France, Japan, the United Kingdom and Canada, in key AI and digital metrics. India also has the world’s second-largest AI talent pool.

Digital Economy and Trade

India generated about US$328 billion in digitally delivered trade, including software exports, IT services and cloud-based solutions. Digitally delivered trade is a category used in global trade statistics for services delivered through digital networks.

AI Talent and Global User Base

Developing countries accounted for 72% of global AI users, with India and China together making up nearly two-fifths of that total. A LinkedIn study cited in the Stanford University 2026 AI Index placed India first in AI skill penetration on LinkedIn and second in AI talent growth globally between 2019 and 2025.

Important Facts for Exams

• Artificial Intelligence refers to computer systems that perform tasks associated with human intelligence, such as learning, reasoning and pattern recognition.
• The AI Index is an annual publication associated with Stanford University that tracks global AI trends, talent and investment.
• LinkedIn is a professional networking platform used in studies of digital skills and labour-market trends.
• Digitally delivered trade includes services such as software, cloud computing and online business services.

Talent Retention

India recorded a net outflow of AI authors and inventors in 2025. This fact is used in global talent studies to measure movement of researchers and innovators across countries.