Artificial Intelligence (AI) remains significantly underutilised by India’s small and medium enterprises (SMEs) and micro, small, and medium enterprises (MSMEs) in the manufacturing sector. Experts at a recent summit organised by the Bangalore Chamber of Industry and Commerce (BCIC) called for a shift in perception—viewing AI not as a disruptive threat, but as a transformative enabler for growth, productivity, and global competitiveness.
AI adoption in India still low
India’s AI adoption in organised manufacturing is estimated at less than 25%, and among MSMEs, the figure drops to just 15%. This is well behind leading economies such as China, Germany, and the US, where AI adoption in manufacturing ranges from 35% to 40%.
BCIC’s Chairman of the Manufacturing Expert Committee, G Prakash, pointed out that MSMEs represent over 90% of India’s industrial units, contribute nearly 30% to the GDP, employ 110 million people, and account for 48% of exports. Yet, most remain hesitant to adopt Industry 4.0 and AI technologies due to perceived complexity and cost.
Prakash argued that this mindset needs to change. “AI is not a luxury; it is a necessity,” he stated, adding that cost-effective, cloud-based, and plug-and-play AI solutions are already available and can deliver productivity gains of up to 30%.
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Industry leaders push for smart, human-AI collaboration
Chandrashekar Bharathi, Managing Director at AceMicromatic MIT, said AI should be ingrained in the DNA of manufacturing operations. “It’s not just about automation anymore—it’s about using AI to repurpose people for higher-value tasks and enable human-machine collaboration,” he said. Bharathi called for integrating AI-driven platforms to improve data harmony, predictive decision-making, and operational resilience under the evolving Industry 5.0 paradigm.
Kenji Anzari, Head of CNC Systems at Mitsubishi Electric India, echoed the sentiment. He described AI as the foundation for the future of manufacturing, noting that smart factories empowered by AI are more efficient, adaptive, and sustainable. According to Anzari, AI-led solutions are already solving major industry challenges—from skill gap reduction to predictive maintenance and smart supply chain management.
AI as a workforce enabler, not a threat
BCIC President Vineet Verma stressed that AI should not be seen as a replacement for human workers. “It’s not about job losses—it’s about expanding human capabilities,” he said. Verma noted that AI reduces the burden of repetitive tasks, allowing employees to focus on strategic and creative work. To remain competitive, companies and workers must prioritise upskilling and adaptability.
The summit concluded with a shared message: India’s manufacturing sector—especially its MSME backbone—must act now to integrate AI into its operations. Doing so could be key to boosting productivity, competitiveness, and resilience in the face of growing global pressure.