Artificial intelligence (AI) is revolutionizing industries, labor markets, and societal structures around the world. With the global AI market projected to grow at a compound annual growth rate (CAGR) of 36.6% from 2024 to 2030, economies are racing to adapt to this seismic shift. Advanced economies, with their focus on cognitive-intensive roles, are at the forefront, but emerging markets are also rapidly scaling their AI capabilities to stay competitive.
The AI Preparedness Index (AIPI)
The AI Preparedness Index (AIPI), published by the International Monetary Fund (IMF), assesses countries based on their ability to adopt and integrate AI technologies. The index evaluates four critical metrics:
- Digital Infrastructure – The foundational tech backbone that supports AI integration.
- Human Capital – Availability of a skilled workforce capable of implementing and adapting to AI.
- Technological Innovation – Investment in and development of AI-specific technology.
- Legal Frameworks – Regulatory structures that govern ethical and safe AI use.
Using these factors, the AIPI ranks countries according to their AI-readiness, highlighting those poised to leverage AI’s economic potential.
Top 10 AI-Prepared Countries in 2023
The top 10 countries in AI preparedness, as ranked by the IMF’s AIPI for 2023, are:
- Singapore – 0.80
- United States
- United Kingdom
- Germany
- France
- Canada
- Australia
- Sweden
- Netherlands
- Finland
Singapore leads the index, largely due to significant investments in AI technology and rapid upskilling initiatives. Its workforce is considered one of the quickest in adopting AI skills, reflecting strong public-private partnerships that drive AI adoption and innovation. Other advanced economies like the United States and the United Kingdom also rank highly, benefiting from cutting-edge digital infrastructure and robust research ecosystems.
India’s Progress and Position in AI Preparedness
India ranks 72nd out of 174 countries, scoring 0.49 on the AIPI. Despite this lower placement, India boasts the highest percentage of AI tool users. For instance, about 45% of surveyed individuals in India have used ChatGPT, demonstrating significant consumer engagement with AI technologies. Furthermore, India’s vibrant startup ecosystem, with 338 AI startups, suggests a growing entrepreneurial interest in AI.
AI Readiness in Other Emerging Markets
Among emerging markets, India ranks relatively high in AI preparedness. Other countries, such as Bangladesh and Sri Lanka, have lower positions, with Bangladesh ranked 113th (score of 0.38) and Sri Lanka 92nd (score of 0.43). China stands out as a stronger emerging market, ranking 31st with a score of 0.63, which reflects the country’s increasing investment in AI and technological infrastructure.
Consumer Awareness of AI Tools
AI awareness among consumers is also on the rise. In India and the United Arab Emirates, over 90% of consumers report familiarity with ChatGPT, an AI-powered language model. Awareness is similarly high in China and Saudi Arabia, where over 80% of consumers are familiar with AI tools. This elevated consumer awareness highlights a growing interest in and demand for AI technologies, especially in regions with rapid digital adoption.
Challenges and Focus for Advanced Economies
For advanced economies, AI integration presents unique challenges. Regulatory frameworks need updating to ensure ethical AI practices, while policies must be implemented to mitigate job displacement. Additionally, these countries are focused on facilitating labor reallocation, which is critical to minimizing the socioeconomic impact of AI.
Priorities for Emerging Economies
Emerging markets, by contrast, are prioritizing the development of robust digital infrastructure and promoting digital skills training. By focusing on building a technologically prepared workforce, these nations aim to capitalize on AI’s benefits and position themselves as future-ready economies.
The Future of AI Preparedness
As AI technologies continue to shape economies, the AI Preparedness Index provides an essential benchmark of readiness. Advanced and emerging economies alike are adjusting their policies and investing in AI capabilities to maximize the technology’s benefits while addressing its challenges. With AI expected to grow in influence, understanding each country’s level of preparedness will be crucial for informed adaptation and sustainable growth.
Through this global lens, it is clear that AI is not just a trend but a transformative force, one that will redefine economies, industries, and the workforce for years to come.