In a step toward understanding the impact of artificial intelligence on India’s rapidly increasing gaming sector, Primus Partners along with the Game Developer Association of India (GDAI), unveiled a research paper titled “India’s US$9.2 billion gaming boom: Powered by 591 million players and AI” at the Waves 2025 held in Mumbai from 1 to 4 May 2025.
At the heart of this research paper lies a narrative – the Indian gaming industry, now valued at US$9.2 billion and powered by a staggering 591 million players, is undergoing a major evolution. India also boasts over 1,900 gaming companies which provide employment to 1.3 lakh professionals, with top players like Nazara Technologies, Nodding Heads Games, and JetSynthesys driving AI-led game development. Amid this momentum, AI is now no longer a fringe enhancement but is becoming the core engine redefining how games are imagined, created, and experienced.
Primus Partners MD Sameer Jain said, “The paper takes a broad look at how AI is shaping the future of gaming and explores how AI is not merely enhancing gameplay, but redefining the entire gaming experience, from personalised content to intelligent NPC behaviour and dynamic storytelling.”
Sharing his views, GDAI chairperson Sridhar Muppudi shared, “AI in gaming has moved beyond the hype cycle and is entering a crucial phase of pragmatic integration. Today, AI is significantly streamlining development by automating intensive tasks like asset generation and testing, allowing human developers to focus more on innovation and creativity.”
Muppudi further added, “In India, with its rapidly growing gaming ecosystem and a massive pool of tech-savvy talent, AI adoption is poised to be a true game-changer — enabling studios to scale faster and compete globally. Looking ahead, the potential is immense: AI as a collaborative partner, driving truly dynamic narratives, crafting highly intelligent characters, and delivering deeply personalised player experiences tailored to India’s diverse and culturally rich audience as well as the global gamer community.”
Additionally, the white paper points out several challenges that are holding back the full potential of AI in India’s gaming industry. The sector is still quite fragmented, and there’s a clear shortage of skilled AI professionals. Many smaller studios also don’t have access to the computing power or data needed to build smart, AI-driven features. On top of that, there are ethical concerns around how AI is used to personalise gameplay, as well as a lack of Indian cultural representation in AI-generated content. The paper stresses the need for responsible development, clear rules, and inclusive design as the use of AI in gaming continues to grow.
According to the report, 66.7 per cent of gaming start-ups cite access to funding as their biggest challenge, particularly those developing AI-driven experiences. A further 44.4 per cent struggle with limited industry mentorship and networking opportunities, while 31.1per cent point to marketing and user acquisition as key hurdles, often due to high costs and limited outreach expertise.
The research also identifies several strategic pathways for harnessing AI’s potential in a sustainable and equitable manner including upskilling talent, encouraging collaboration between tech and creative artists and setting up smart regulations that protect users while allowing innovation. The paper encourages policy leaders to view gaming not merely as entertainment but as a growing cultural and economic force that deserves engagement from all stakeholders.
India’s digital friendly youth and its thriving start-up ecosystem form a potent combination that places the country in a unique position to lead globally in AI-driven gaming. With increasing smartphone penetration, affordable data, and a robust developer community, the Indian market is ripe for disruption and leadership in next-generation game development.
Speaking at the launch, Primus Partners VP Amit Purohit shared, “Gaming in India is not just about play—it’s about potential. This report underscores how AI can unlock value across the creative, technological, and economic layers of the industry. We hope this paper sets the stage for more informed conversations and collaborative innovation in this space.”
The research calls for proactive, inclusive, and ethically grounded innovation strategies that will help ensure that the rise of AI in gaming serves both the industry and the broader public good.
This publication by Primus and GDAI is expected to serve as a reference document for industry leaders, academic researchers, policymakers, and emerging entrepreneurs. It not only provides insights on current trends but can also serve as a blueprint for the road ahead.
