CCI study finds 67% of Indian AI startups focused on building AI applications, reshaping India's business landscape

New Delhi [India], October 8 : A recent survey by the Competition Commission of India (CCI) has found that nearly 67 per cent of Indian AI (Artificial Intelligence) startups are primarily engaged in developing AI-based applications, with the majority relying on open-source technologies.

The study highlighted how artificial intelligence is rapidly reshaping India's business landscape, driving efficiency and innovation across sectors.

According to the findings, 76 per cent of startups build their AI solutions using open-source platforms due to their accessibility and cost advantages.

It stated "the core area of work for almost 67 per cent of respondents in AI startups in India lies in the layer of building AI applications. The adoption of AI technologies in India is rapidly accelerating across various user sectors. The integration of AI across industries is reshaping market structures and business strategies".

Around 88 per cent of the respondents use machine learning (ML) as the foundation for their AI solutions, while 66 per cent employ generative AI models such as large language models (LLMs). The use of natural language processing (NLP) stands at 78 per cent, and 27 per cent of startups are working in computer vision (CV).

The CCI noted that global players such as Google, Microsoft, Meta, Amazon and OpenAI are major contributors to open-source technologies and algorithms used for model building.

The adoption of AI is also spreading quickly across industries, transforming how companies operate. The study found that AI is being widely used in banking and financial services, healthcare, retail, e-commerce, logistics, and marketing for purposes such as dynamic pricing, personalised recommendations, demand forecasting, and automated decision-making.

About 90 per cent of the businesses surveyed said they use AI to monitor customer behaviour, while 27 per cent use it to track supply chain efficiency. Nearly 69 per cent use AI for demand forecasting, 24 per cent for pricing trend analysis, and 21 per cent for predicting inventory needs.

The survey report also highlighted that AI helps businesses improve productivity, reduce costs, and gain a competitive edge by offering better and more personalised services. However, it also warned that companies failing to adopt AI risk losing competitiveness in an increasingly AI-driven market.

Reacting to the findings of the study, Shivanghi Sukumar, Partner, Axiom 5 law chambers, said, "The CCI's study adopts a thoughtful and forward-looking approach that aligns with the objectives of the IndiaAI Mission. The study highlights areas that could shape competition dynamics in the future, including emerging risks of algorithmic collusion, opacity in AI decision-making, and unequal access to data and compute. By flagging these issues early, the CCI acknowledges that AI could gradually reshape market structures".

To ensure fair competition and safeguard consumer interests, the CCI said it will continue to focus on promoting a culture of competition compliance and preventing AI-driven anti-competitive practices.

The commission aims to support the development of a healthy and innovative AI ecosystem in India.

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