The Asia Pacific region is expected to see artificial intelligence (AI) and generative AI (GenAI) spending reach $175 billion by 2028, according to research firm International Data Corp. (IDC).
IDC said the growth covers investments in software, services, and hardware built for AI-driven systems. The market is forecast to grow at a compound annual growth rate (CAGR) of 33.6% from 2023 to 2028. GenAI alone is projected to reach $54.5 billion by 2028, making up around 31% of the overall AI and GenAI spending in the region.
“Looking ahead, 2025 will be the year of unified AI platforms that support AI agents — integrated frameworks that support the full lifecycle of AI models, including GenAI, predictive, prescriptive, and other emerging models,” said Deepika Giri, head of research, Big Data & AI, IDC APJ. “These platforms will connect applications, data, infrastructure, and governance, offering a more standardized and scalable approach to AI deployment.”
Growing impact of AI and GenAI
IDC’s findings point to the increasing role of Asia Pacific in shaping the global AI market. Businesses in the region are moving beyond pilot programs, embedding AI into key operations such as customer service, decision-making, automation, and cybersecurity.
Key factors driving AI and GenAI investments include the demand for stronger digital infrastructure, changing customer needs, pressure to improve operational efficiency, and the need for better security and real-time insights. These trends are reshaping industries like finance, manufacturing, and healthcare.
“This shift toward AI-driven solutions is laying the foundation for a future centered on intelligent automation and continuous innovation,” said Vinayaka Venkatesh, senior market analyst, Data & Analytics, IDC Asia/Pacific.
Main areas of AI investments
A large share of AI and GenAI spending goes into building strong infrastructure. This includes hardware upgrades, cloud services, and improved data center capabilities, accounting for almost 37% of the market.
At the same time, AI-powered chatbots and virtual assistants are being used to offer faster customer support. AI solutions are also making call centers and field service operations more efficient.
Governments in the region are also adopting AI to improve national security and emergency response. AI tools are being used for surveillance, threat detection, and faster decision-making during crises, supporting efforts to protect public safety.