India is making waves in the global generative artificial intelligence (GenAI) segment and steadily climbing the ranks to become a key player. A report by Nasscom lately highlights that India is placed at the sixth position among major economies in the GenAI startup ecosystem. A remarkable surge in funding as well as a growing appetite for impactful AI solutions are basically believed to be fuelling the rise.

Indian GenAI startups raised $51 million in the second quarter of FY25. It is a massive leap from just $8 million in the first quarter. The sixfold increase reveals a renewed confidence in the potential of AI-driven innovation. Early-stage funding took center stage equipped with angel and seed rounds which accounted for 77% of all investments. More than 90% of the funding went to just three startups: Nurix AI, Dashtoon and Mihup.

But it is not just about numbers. The industry is evolving in exciting ways. Sangeeta Gupta, Nasscom’s Senior Vice President, said that GenAI is reshaping technology service providers and creating new possibilities.

Partnerships are also playing a big role. Companies are joining forces to enhance their AI capabilities and expand global reach. The collaboration of Accenture with Unilever is an example that is helping the latter to boost efficiency and agility using GenAI. Genpact similarly has teamed up with Volkswagen Financial Services to explore AI-driven innovations. Nasscom notes that the partnership activities increased by 25% in the last quarter and this reflect the collaborative momentum of the industry.

Revenue growth in the sector is another promising sign. Accenture reported $3 billion in GenAI-related bookings equipped with $1 billion in realization. TCS also made significant gains and secured $1.5 billion in bookings. The figures show that GenAI is becoming a core part of business strategies.