Open Source Fuels India's AI Market Growth, Says Linux Foundation Research

Feb 18, 2026, 2:33 AM
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A recent report from the Linux Foundation, in collaboration with Meta, underscores the critical role of open source technology in propelling India's burgeoning artificial intelligence (AI) market. The report, titled AI for Economic and Social Good in India: Scaling Inclusive Growth for Entrepreneurs, Creators, and Local Economies, reveals that the AI market in India is projected to grow from $6 billion in 2024 to nearly $32 billion by 2031.
One of the report’s standout findings is that 76% of Indian startups utilize open source AI, which facilitates cost-effective innovation and customization. This trend not only enhances the startup ecosystem but also aligns with global demand for technical talent from India, positioning the country for significant economic opportunities in the AI sector.
"India is leveraging open source to define its own unique trajectory in the AI revolution," stated Hilary Carter, senior vice president of research and communications at the Linux Foundation. The favorable conditions for AI adoption include a robust IT services industry, a youthful and digitally fluent population, and a government that actively supports digital public infrastructure, enabling faster localization and scaling of AI solutions.

Economic Growth Through Open Source Innovation

India’s impressive growth in the AI landscape can be attributed to several structural advantages. With over 200,000 startups and ranking fourth globally for newly funded AI companies, India is witnessing an unprecedented acceleration in AI-related hiring—the highest year-over-year rate in the world. This environment encourages localized innovation, which lowers barriers for startups and small businesses, allowing them to create tailored solutions for both private and public sectors.
Arpit Joshipura, senior vice president at the Linux Foundation, emphasized that India’s talent pool is being harnessed to tackle real-world challenges swiftly and effectively. "With a supportive government mandating open source for critical infrastructure and a startup culture that relies on open AI tools, India is the ultimate sandbox for innovation," he noted.

Addressing Workforce Challenges

While the growth of AI presents significant opportunities, it also raises concerns about workforce displacement. The report indicates that 45-69% of jobs in sectors such as manufacturing, customer service, and retail could be impacted by automation by 2030. However, India is emerging as a global hub for AI talent due to substantial investments in education and skilling initiatives, which aim to mitigate these potential disruptions.
To navigate these challenges effectively, the report suggests several key recommendations, including the development of a national vision for open source AI and the enhancement of workforce readiness through reskilling and training programs. Initiatives like the Skill India Digital Hub are designed to help individuals find training and employment opportunities in their local languages, thus promoting inclusivity.

Social Impact and Real-World Applications

Beyond economic growth, the report highlights the concept of "AI for social good" as a pivotal aspect of India’s AI adoption story. By leveraging open source models, local developers are creating culturally and linguistically relevant solutions to address pressing societal challenges. For instance, projects like Adalat AI aim to streamline judicial processes, while Farmers for Forests utilizes AI to aid smallholder farmers in transitioning to sustainable agricultural practices, significantly increasing their incomes.
Rob Sherman, vice president of policy at Meta, commented on India's position in the global AI landscape, stating, "Open source AI coupled with pro-innovation regulation can supercharge India's AI ambitions—empowering local talent to build, adapt, and scale technologies not just for India, but for the world".

Conclusion

The Linux Foundation’s report paints a promising picture of India's AI future, driven by open source technology. With its rapidly expanding market and a commitment to inclusive growth, India is not only poised to thrive economically but also to set a precedent for using AI as a catalyst for social good. As the global demand for AI solutions continues to rise, India's unique approach to open source innovation could serve as a model for other nations looking to harness the power of technology for economic and societal advancement.
For further insights, the full report can be accessed through the Linux Foundation’s research series, which examines AI adoption and its implications across various global regions.

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