As artificial intelligence (AI) becomes central to enterprise strategy, Indian tech firms must strike a balance between regulatory compliance and building trust to fully harness AI’s capabilities, analysts from Massachusetts-based research firm Forrester have warned.

With half of G20 nations now mandating domestically tailored AI models for public services, enterprises in India are expected to prioritise private cloud solutions for sensitive workloads and AI model training. This approach will help mitigate geopolitical risks while ensuring compliance with emerging data sovereignty mandates.

During a media briefing on December 3, 2025, Forrester’s technology experts shared predictions for 2026, highlighting a pivotal year for Indian organisations. As the initial hype around AI subsides, leaders are likely to move away from performative initiatives and premature declarations. Instead, decisions will be guided by evidence, operational rigor, and measurable outcomes.

“AI adoption will no longer be about experimentation alone,” the analysts noted. “Enterprises that align regulatory compliance with transparent AI practices will gain trust, secure sensitive operations, and realise the technology’s full potential.”

For Indian tech firms, this means investing in governance frameworks, robust data management practices, and secure infrastructure. Firms that successfully combine compliance with accountability are poised to lead in AI-driven innovation, according to Forrester.