Nine in ten Indian enterprises consider security & privacy risks stall AI scaling

New Delhi, Aug 16 Nine out of ten Indian enterprises cite data security and privacy risks as their most significant obstacle to scaling AI and analytics, a report said on Saturday.

"Phishing remains a top concern, with 77 per cent of chief information officers (CIOs) rating it as highly or moderately severe," according to the '2025 State of Enterprise Technology Survey' by CIO and Leader and BMNXT.

Identity-based attacks and ransomware continue to pressure enterprises, while AI-generated threats such as model poisoning and data leakage are emerging as new frontiers of risk, the report stated.

“AI is changing the cybersecurity game on both sides — attackers are using it to innovate threats, and defenders are using it to automate detection and response. The challenge for enterprises is to stay ahead by embedding security into AI initiatives from day one,” said R. Giridhar, Head of Research, 9.9 Group.

Cloud-native security controls, zero-trust architectures, and privacy automation are becoming core capabilities, particularly in regulated industries.

At the same time, AI-powered detection is gaining ground, enabling faster anomaly detection, behavioural baselining, and automated incident response, the report said.

According to the report, SOC modernisation and the adoption of Privileged Access Management (PAM) are increasing to address the challenges of complex hybrid IT environments.

Deepak Kumar, Founder & Chief Analyst, BMNXT and Consulting Research Partner, CIO and Leader, said, “The numbers make it clear — security and privacy are no longer just IT concerns; they are board-level priorities. The next phase of AI adoption will hinge on trust. Organisations that fail to address security as a foundational element risk stalling their digital transformation.”

Other key barriers to scaling AI cited by respondents include data availability and quality issues (90 per cent), choosing the right technologies (88.3 per cent), and change management challenges (86.7 per cent).

“CIOs today are walking a tightrope — they need to scale AI to drive competitiveness, but they cannot afford to compromise on trust. Building privacy-by-design, governance, and literacy into AI strategies will be critical to balancing speed with security,” Jatinder Singh, Executive Editor, CIO&Leader, added.

The Survey captures insights from over 350 CIOs and technology leaders across India’s top enterprises, providing a comprehensive view of priorities, challenges, and opportunities in AI, cloud, application development, and cybersecurity.

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