Artificial intelligence has emerged as the highest-growing compensation category in India, recording 12% year-on-year salary growth according to the latest foundit Insights Tracker. This growth trajectory is even more pronounced over a two-year period, with AI salaries compounding 23% between 2024 and 2026, rising 10% and then 12% consecutively. The surge is driven by companies' selective approach to premium compensation, prioritizing skills that fill critical business capability gaps over traditional experience-based pay structures. As reported by foundit, businesses are becoming pickier about what they will pay more for, with the strongest raises now determined by whether a talent closes a capability gap that the company requires, not by experience alone.
The compensation differential between AI specialists and traditional IT roles is substantial. AI professionals with zero to three years of experience earn between ₹8.87 lakh and ₹15.41 lakh per annum, while those with more than 15 years of experience command ₹70.99-89.24 lakh per annum. In contrast, entry-level IT and IT services positions start at ₹2.68-5.08 lakh per annum, roughly one-third of what AI freshers command, and reach ₹57.55-72.13 lakh per annum at 15-plus years, still considerably below the upper end of compensation for senior AI professionals. Both categories have recorded a 1% pay decline over the last year, reflecting the widening gap between specialized, high-demand skills and more established professions.
Location significantly impacts AI compensation across India. Bengaluru remains India's highest-paying market for AI professionals, with senior AI professionals earning ₹61.70-91.25 lakh per annum, roughly 10-15% more than in NCR or Mumbai and up to 40% more than in Chennai at senior levels. The strong concentration of product companies, AI-first startups and global capability centres (GCCs) drives demand for specialized talent and supports higher compensation levels. However, Tier-II cities show a 28-31% lower salary gap compared to metro pay, with the differential widest at senior levels. Pune and Chennai are building specialist premiums in automotive AI, industrial automation, and manufacturing analytics, while Hyderabad emerges as a close challenger backed by expanding global capability centres and product engineering investments.
Beyond AI, the compensation landscape shows mixed performance across technology sectors. Computer and network security recorded 9% growth, while data mining achieved 7% growth. In contrast, computer software and computer networking recorded marginal 1% growth each. The decline is evident in traditional IT sectors, with information technology falling 1%, internet salaries dropping 2%, e-commerce declining 3%, and computer hardware falling 4% over the last year. Manufacturing and specialized healthcare sectors are leading salary growth outside technology, with semiconductor salaries compounding 17% over two years and industrial automation achieving 13% compound growth. Cybersecurity recorded the highest annual compensation ceiling among all categories analysed, at ₹97.81 lakh.
According to Tarun Sinha, CEO of foundit, companies are becoming selective about premium compensation, with experience alone no longer commanding the strongest raises. The focus shifts to skills that fill business capability gaps. For professionals, salary growth will increasingly follow those who deepen and renew their skills as business needs evolve. The data reflects a fundamental shift in the Indian compensation landscape, where specialized skills in emerging technologies like AI, cybersecurity, and semiconductors are commanding premium compensation while traditional IT roles face stagnation or decline. This widening gap between specialized, high-demand skills and more established professions is expected to continue as businesses prioritize capabilities over experience in their compensation strategies.
