Despite growing interest in AI, IT services sector leads Indian startups, ranking ninth in AI startup rating
Read more
Aaj Tak
www.aajtak.in

Despite growing interest in AI, IT services sector leads Indian startups, ranking ninth in AI startup rating

There is active global discussion about artificial intelligence (AI), which has even permeated office planning. Nevertheless, in India, AI-related startups rank ninth, while IT services startups are the most numerous.

According to a response received from the Department for Promotion of Industry and Internal Trade (DPIIT) under the Right to Information (RTI) Act, the information technology services sector leads in the number of recognized startups in India. Furthermore, the state of Uttar Pradesh has approached the level of Karnataka in terms of the number of recognized startups.

DPIIT reported in the response provided under the Startup India section dated August 13, 2026, that certificates of startup status were issued to a total of 245 thousand organizations from 2016 to July 31, 2026. The department specified that this statistic includes approved, cancelled, and expired statuses. In total, the recognized startups have provided 2,507,365 jobs.

The share of AI is only 3.2%

Out of the total of 245,433 recognized organizations, only 7,825 startups indicated AI as their primary business focus. Thus, the share of AI startups in the total number is only 3.2%, and the AI industrial list ranks ninth. Regarding information technology services, there are 27,830 such startups registered in India, and they are at the top of the list. The IT industry's share in the total number of recognized startups is 11.3%. The second most significant sector is healthcare and life cycles, with 22,500 startups. It is important to note that this classification is based on the main industry declared when applying for recognition, so some startups using AI in their products or services may be registered in the IT services, healthcare, or other sectors.

Agriculture and education lag behind AI

In the Indian startup ecosystem, construction/building ranks third with 14,265 recognized startups, almost double the number of AI startups. The number of food and beverage startups reaches 13,877. Agricultural startups number 13,753, and educational startups number 13,426.

A total of 140,677 startups are included in the top 10 industries, which accounts for about 57% of the total recognized startups. This demonstrates that the Indian startup ecosystem is not limited only to software and technology but is also actively developing in traditional sectors such as construction, food, agriculture, and education.

Maharashtra leads among states in startups

When looking at state-level indicators, Maharashtra is the leader, having approximately 42,396 registered startups that provided 442,296 jobs. Maharashtra ranks first in both metrics. Karnataka is second, with a difference of 17,800 startups between the first two places. Uttar Pradesh ranked third (24,245), and Delhi fourth (22,720). Gujarat reported 21,521 startups and 235,458 jobs. Among the top 10 states are also Tamil Nadu (16,082), Telangana (13,941), Haryana (12,776), Kerala (9,278), and Rajasthan (8,960).

Haryana is not inferior to anyone

In terms of employment, Haryana demonstrated a significant advantage. This state has 12,776 registered startups that created about 150 thousand jobs, which is the highest figure among the top 10 states on average. The average number of jobs per startup in Haryana is approximately 11.8.

Uttar Pradesh is approaching Karnataka in startup numbers

Uttar Pradesh is rapidly strengthening its position as a major startup hub in the country, with 24,245 registered startups. Karnataka has 24,546 registered startups, and the difference between them is only 301. Karnataka was long considered the center of the Indian startup economy, but now Uttar Pradesh is catching up to its level. Regarding employment, the average in Karnataka is 10.7 jobs per startup, whereas in Uttar Pradesh, this figure is lower—9.4 jobs per startup.

Growth in the number of startups in India

The number of startups in India continues to grow. In 2024, there were 34,294 registered startups in the registry, and in 2025, 49,429 startups were approved, marking an increase of 44%. In just seven months in 2026 (until July 31), 38,298 startup registrations were issued, representing an increase of approximately 77% compared to 2025. There are suggestions that a new record for startup registrations may be set in 2026, although exact data on the current number of active and closed companies is still unavailable.

Similar stories

World Bank: India Ranks in Top 10 Emerging Markets for AI Readiness, Private Investment Triples
Read more
yourstory.com

World Bank: India Ranks in Top 10 Emerging Markets for AI Readiness, Private Investment Triples

The World Bank reported on Tuesday that India ranks among the top ten emerging markets in terms of readiness to use artificial intelligence (AI). Thanks to its large technical staff, globally integrated IT sector, and digital public infrastructure, the country is well-prepared to implement this technology.

In its latest report titled 'India and Artificial Intelligence: Harnessing the Opportunity for Development,' the World Bank noted that private investment in AI in India has more than tripled. In 2025, the volume of these investments reached $4.1 billion, compared to $1.2 billion in 2024.

Furthermore, in 2025, the number of specialists employed in Global Capability Centers (GCCs) increased to 2.36 million from 1.9 million the previous year. Nevertheless, the report emphasized that the long-term impact of AI on the labor market and economy remains uncertain.

In this regard, the World Bank called for the adoption of comprehensive policy measures. These measures should aim to deepen the infrastructure supporting AI development, improve the business climate, expand access to AI, and enhance human capital so that the benefits of the technology can be widely distributed.

Paul Rossi, World Bank's Director for India, stated: 'India is one of the top ten emerging markets in terms of AI readiness.' He added that 'using AI as a tool for development, rather than just as a technology, can be one of the most powerful levers available to India to boost productivity and improve public services.'

The Bank's global group also invests through AgriConnect in 'small AI' tools that are locally adapted and aimed at ensuring that the benefits of AI reach wider segments of the population while supporting workers during the transition.

The 'India Development Update' is a supplement to the World Bank Group's 'South Asia Economic Outlook,' which analyzes economic development and prospects in the region. According to this outlook, South Asia is projected to grow by 6.9 percent in 2026, maintaining its status as the world's fastest-growing region.

The report also indicated that for most South Asian countries, the greatest gains from AI are likely to come from adapting and applying the technology to local conditions, including using small AI applications suitable for resource-constrained environments.

Popular