The core idea behind this integration of AI is to preserve the expertise of retiring employees and pass it on to the new generation, ensuring that valuable knowledge is not lost. When combined with digital twins — virtual representations of physical assets or processes — the impact of AI becomes even more powerful. This union enables a range of advancements from enhanced performance monitoring and optimization to creating realistic simulations and generating precise predictions. Together, AI and digital twins have the potential to revolutionize industries by improving operational efficiency and fostering smarter decision-making.

One clear example of this transformation can be seen in the IT sector. Historically, one IT administrator might have serviced around 1,000 tickets. However, thanks to digitalization, the same administrator can now handle up to 100,000 tickets. Importantly, this shift doesn’t eliminate IT jobs but rather increases productivity, demonstrating that digital tools can augment human capacity rather than replace it.

This pattern is expected to repeat across multiple industries as digital technologies become more widely adopted. According to WEF, when these technologies are combined with sector-specific knowledge, they can unlock vast new possibilities, making cutting-edge solutions more accessible and addressing crucial challenges such as equitable growth and sustainability. The ability to scale such technologies holds the potential to not only improve productivity but also to help tackle some of the world’s most pressing issues.

AI’s strength lies in its capacity to turn raw data into actionable insights. When paired with digital twins, AI enables the collection, analysis, and optimization of data to eliminate inefficiencies and make smarter decisions. For example, in highly automated manufacturing environments, machines generate vast amounts of data—equivalent to half a million movies every month. Historically, much of this data has gone underutilized, but with the introduction of AI, manufacturers are able to unlock valuable insights. AI helps to identify patterns, spot inefficiencies, predict outcomes, and facilitate better decision-making. In fact, in quality control, the integration of AI and digital twins has reduced efforts by 95%.

While the use of AI and digital twins is particularly transformative in manufacturing, the potential of these technologies extends far beyond factories. In healthcare, AI can assist in interpreting complex medical images, such as MRI scans and X-rays, improving diagnostic accuracy and efficiency. In agriculture, robots equipped with AI can help identify ripe fruits for harvesting, streamlining processes in the field. In the building sector, AI can be used to analyze data from building materials and designs to enhance energy efficiency, reduce costs, and lower carbon emissions.

To unlock the full potential of these technologies and address the global productivity gap, the key lies in developing a comprehensive digital strategy. By adopting technologies like AI and digital twins across industries, we can drive sustainable growth, foster innovation, and improve efficiency. As WEF emphasizes, how we embrace and implement these tools today will lay the foundation for future generations, creating a landscape where technology not only boosts productivity but also tackles critical global challenges such as sustainability and equitable development.

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The industrial and warehousing sector emerged as the dominant contributor to these investments, attracting a significant USD 2.5 billion. This represents a staggering 190% increase from the previous year and accounts for 39% of the total real estate investments. The office segment, which brought in USD 2.3 billion or 36% of total investments, closely followed the industrial sector in terms of inflows.

This surge in industrial and warehousing investments is primarily driven by robust manufacturing growth, improvements in logistics infrastructure, and India’s increasing position as a global manufacturing hub. Interestingly, more than 80% of these investments were sourced from foreign investors.

The residential real estate sector also performed well in 2024, with investments reaching USD 1.1 billion, marking a 46% increase compared to the previous year. This growth is attributed to strong domestic demand for housing.

Meanwhile, mixed-use properties saw a significant shift in investment patterns, with an impressive 822% rise in inflows, reflecting the evolving nature of investment trends in the Indian real estate market.

Domestic investors played a key role in driving the 2024 investment growth, contributing nearly one-third of the total inflows. These domestic investments increased by 27% YoY, with the fourth quarter of 2024 witnessing an especially strong performance. In Q4, investments reached USD 1.9 billion, more than double the amount seen in the same period of 2023. During this quarter, domestic investments accounted for 43% of the total, signaling increased confidence among Indian investors while international interest remained strong.

Foreign investments continued to dominate the Indian real estate market, contributing 66% of the total inflows. Of these foreign investments, investors from the Asia-Pacific (APAC) region made up nearly one-third, underscoring India’s growing appeal to global investors.

Mumbai captured the largest share of real estate investments in 2024, totaling USD 1.6 billion or 24% of the overall investments. The office sector led Mumbai’s real estate investments, making up 58% of the total, followed by industrial and warehousing investments at 20%.

Other major cities, including Bengaluru, Chennai, and Delhi NCR, attracted significant investment, each accounting for 8-9% of total inflows. Cities such as Hyderabad, Pune, and Kolkata also witnessed strong YoY growth in investments, particularly in the industrial and warehousing segments.

A notable trend in 2024 was the rise in multi-city deals, which accounted for 39% of the total real estate investments. This indicates a more balanced distribution of capital across India’s major real estate markets.

Badal Yagnik, CEO of Colliers India, commented, “APAC investors drove nearly one-third of the foreign inflows into the country’s real estate sector in 2024. Looking ahead, Tier-I cities will continue to attract the majority of capital, aided by government support for infrastructure development and the ‘Make in India’ initiative. While global investor confidence is expected to remain high, 2025 is likely to see increased capital deployment from domestic players across office, residential, and industrial segments.”

Vimal Nadar, Senior Director and Head of Research at Colliers India, added, “With the scale-up of manufacturing and continued healthy consumption levels, both domestic and global investments are expected to flow into ready-to-use and developmental industrial assets in the future.”

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India’s private sector experienced robust growth in December, registering its highest performance in four months. Both the manufacturing and services sectors saw accelerated growth, driven by a rise in new business inflows and increased job creation.

The HSBC Flash India Manufacturing PMI rose to 57.4 in December from 56.5 in November, signaling improved business conditions. Gains in production, new orders, and employment fueled the recovery, with a rise in domestic demand playing a pivotal role.

Meanwhile, the services sector continued to lead growth, reflected in the HSBC Flash India Services PMI Business Activity Index, which climbed to 60.8 in December, up from 58.4 in November. Service providers recorded a sharper increase in sales and backlogs, showcasing the sector’s resilience.

Private sector firms also expanded their workforce significantly in December, with job creation reaching a new survey peak. Employers added both permanent and temporary staff to meet the growing demand, and backlogs of work rose at the fastest pace since May 2024.

Ines Lam, Economist at HSBC, stated, “In this flash release, the small rise in the headline manufacturing PMI in December was mainly driven by gains in current production, new orders, and employment. The expansion in new domestic orders quickened, suggesting a pick-up in growth momentum in the economy.” Lam also noted that sustained increases in input costs have prompted manufacturers to continue raising selling prices. The output price index rose to its highest level since February 2013.

Demand for Indian goods and services experienced its sharpest increase since July, with both domestic and international orders contributing to growth. New export orders expanded at the fastest rate in five months, with the manufacturing sector outperforming services in export growth.

Business optimism strengthened for the second consecutive month, reaching its highest level since September 2023. Manufacturers and service providers alike expressed positive demand expectations, with stronger customer relations boosting their confidence.

Although cost pressures eased slightly from the 15-month high seen in September, input costs for items like food, freight, and labor continued to rise. Despite this, firms increased selling prices, though at a slower rate than November’s near 12-year high.

Manufacturers stepped up input purchases in December, benefiting from improved vendor performance. Pre-production inventories grew, while finished goods stocks contracted as companies utilized inventory to meet rising demand.

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