India’s Gaming Industry Eyes the AI Cheat Code to Play in the Global Arena

India’s gaming studios have long been boxed in by a familiar set of challenges: tight budgets, long development cycles, and limited access to global-caliber design talent. But artificial intelligence is likely to alter the script and help Indian gaming studios make their mark in the global market, say top players of the nascent gaming ecosystem in the country.

Over the past few years, AI has been moving into the heart of game creation, generating storylines, building characters, running simulations, and even helping personalise gameplay in real-time. And for India’s scrappy, mobile-first developers, that shift could be transformational.

“AI allows you to produce content in a much faster manner,” says Nitish Mittersain, CEO of Nazara Technologies. 

“In India, the big challenge for developers has been around game design and monetization. I think AI can help improve all of that very quickly and bridge the experience gap between global developers and Indian developers. Everyone is starting to use AI, and I believe in the next one to three years, we’ll start seeing Indian games performing well on the global stage.”

AI is set to bring down the cost of game development by as much as 20–30% over the next five to ten years, according to industry estimates. A 2023 Bain survey noted that while generative AI currently contributes to less than 5% of the overall development process, its role is expected to expand significantly, especially in asset generation, narrative design, and quality assurance. 

BCG, in a separate report, stated that over 68% of global gaming executives believe generative AI will unlock material cost savings, particularly in mid- to large-budget productions. For top tier production-quality games, where development budgets can exceed $200 million, generative AI could eventually automate up to half of the production workflows, potentially reducing costs by tens of millions of dollars per project. 

While only 20% of executives surveyed by Bain expect immediate cost cuts, most agree that AI will reduce development cycles and enable smaller teams to achieve more. Industry insiders say this shift could help game studios from India become far more competitive in the global market by overcoming traditional constraints around time, talent, and funding allowing them to produce high-quality titles at faster speeds and lower costs.

Mobile Premier League’s Tarun Singh Bisht breaks it down: “Prototyping, development, and testing, which used to take months, can now often be done in days or weeks,” he said. “Especially for indie game studios and up-and-coming developers, this means faster iteration, lower barriers to entry, and the ability to compete with fewer resources.”

Nazara, one of India’s best-known gaming firms, is already making strategic moves. It recently launched Nazara Publishing, a platform offering Indian developers access to funding, global distribution, and AI-powered production infrastructure. “India is our home strategic market where we’re investing heavily,” said Mittersain. “We also see a large opportunity for Nazara to become a respected gaming company out of India. That’s why you’ll see us acquire a lot of gaming studios outside India, support them with additional resources from here, and leverage established gaming IP, which we can further monetize using AI.”

Globally, studios both big and small are leaning into AI’s creative potential. Ubisoft’s “Ghostwriter” tool drafts filler dialogue for non-playable characters (NPCs), while indie developers are using AI to generate environment art and test entire story arcs, sometimes across languages, devices, and user cohorts all without adding headcount.

In a conversation with McKinsey, the chief technology officer of US-based gaming major Electronics Arts, said the company was actively using generative AI for bug fixing, NPC scripting, and in-game balancing & freeing up human designers to focus on the emotional texture and storytelling that players crave. “Generative AI will become an incredibly powerful co-pilot,” the CTO said. “But the magic still lies in what people choose to build with these tools.”

In India, where mobile-first users span dozens of languages and regional preferences, that personalization edge is crucial. “Whether it’s surfacing the right content at the right time, skill matchmaking for game progression, or localising experiences across devices, languages, and regions, AI helps make games feel more relevant and intuitive to a wider range of players,” said MPL’s Bisht.

But while AI can supercharge development, it isn’t a silver bullet. A recent MIT Technology Review article flagged the risks of relying too heavily on automation. Poorly trained models can lead to botched dialogue, incoherent plotlines or worse, culturally insensitive tropes. “Human oversight is critical to ensure consistency, coherence, and cultural sensitivity,” the report noted.

That’s why most Indian studios are betting on a hybrid approach: AI for scale, humans for soul. Salone Sehgal, General Partner at gaming VC Lumikai, summed it up on a podcast: “AI reduces the entry barriers for building high-quality games. It also creates opportunities for faster iteration and personalisation, which were previously only accessible to large studios. But it’s the creative lens of the developer that makes a game memorable.”

India may just be the perfect testing ground for this model. With a vast, youthful population, a ballooning base of mobile gamers, and a growing ecosystem of game tech and design talent, the country is primed to emerge as an AI-enabled game exporter.

“This is not a short-term play,” Mittersain said. “We’re committed to building a long-term gaming ecosystem in India, supported by technology, talent, and AI.”

The grind is getting smarter and India’s game is just getting started.