As India prepares to host the AI Impact Summit in February 2026, the focus is shifting to how artificial intelligence can shape the country’s next phase of urban growth. With cities expected to contribute nearly 70% of GDP by 2050, urban populations are set to almost double. Therefore, the challenge is no longer expansion. Rather, it is better governance. AI offers an opportunity to improve efficiency, equity, and resilience in urban administration, in line with Viksit Bharat’s vision.

Over the past decade, missions such as AMRUT, Swachh Bharat Mission, Pradhan Mantri Awas Yojana, and the Smart Cities Mission have laid the foundation for urban development. The Smart Cities Mission delivered over 8,000 projects worth Rs 1.64 lakh crore between 2015 and 2025. However, its experience also highlighted that technology-led approaches without strong municipal capacity and citizen trust can create fragmented outcomes. Therefore, as India moves into its next phase of city-building, AI must reinforce local institutions rather than operate in silos.

India is well-positioned to lead this shift. More than 56% of metro adults already use generative AI tools. Cities like Bengaluru have emerged as major AI talent hubs. Yet fragmented data systems and limited capacity at the municipal level often slow adoption. Consequently, bridging national AI strengths with on-ground city administration remains the key task.

Global experience shows that governance is decisive. Singapore’s Smart Nation journey was built on decades of data integration. Meanwhile, Barcelona and New York City focused on transparency, accountability, and treating data as a public good. These lessons underline the importance of trust and institutional design as AI scales across cities.

For India, building a reliable, interoperable urban data infrastructure is the top priority. Critical datasets such as transport data remain siloed across agencies. The IndiaAI Mission, approved in 2024 with an outlay of Rs 10,300 crore, should also be more closely aligned with city governance. In doing so, AI can directly improve services such as mobility, waste management, and grievance redressal.

Initiatives such as an Urban AI Challenge and a national repository of proven city-level use cases could accelerate adoption. This would ensure ethical and replicable solutions. More sensors will not drive India’s next urban transformation. Instead, smarter integration, adaptive intelligence, and citizen trust will—setting the stage for inclusive, AI-led urban governance.

Ready to invest like a pro? Tradz by EquityPandit equips you with 100+ Free tools and knowledge you need to succeed. Download the Tradz app and gain access to daily stock lists and insightful market analysis and much more!