India Inc. Braces for a Fresh Era of Risk: Cybersecurity, AI, and Geopolitical Volatility
New Delhi – A recent FICCI-EY Risk Survey 2026 reveals a significant shift in the risk landscape for Indian businesses. Cybersecurity breaches have emerged as the primary concern for 51% of India Inc., surpassing even geopolitical tensions and economic uncertainties. This heightened anxiety comes as India’s economy is projected to grow by 7.4%, highlighting a paradox of optimism tempered by vulnerability.
The Rising Tide of Cyber Threats
The survey underscores a growing recognition that technology risk is now inextricably linked to operational continuity. A substantial 61% of leaders believe rapid technological change and digital disruption are impacting their competitive edge. This isn’t merely about potential financial losses; 61% identify cyber-attacks and data breaches as major threats to their reputation. Further compounding the issue, 57% report concerns about data theft and insider fraud, while 47% acknowledge the difficulty of combating increasingly sophisticated cyberattacks.
This trend reflects a global pattern. Organizations are increasingly reliant on digital infrastructure, creating more entry points for malicious actors. The interconnectedness of supply chains also means a breach at one company can have cascading effects across multiple sectors.
AI: A Double-Edged Sword
Artificial intelligence presents a unique challenge. While 60% of respondents believe inadequate AI adoption could hinder operational effectiveness, a nearly equal 54% express concerns about the ethical and governance issues surrounding AI. This duality suggests Indian companies recognize the potential benefits of AI but are struggling to navigate the associated risks.
The lack of clear regulatory frameworks and the potential for algorithmic bias are key concerns. Companies are hesitant to fully embrace AI without assurances that they can manage these risks effectively.
Geopolitical Instability and Supply Chain Resilience
Geopolitical tensions remain a significant worry for 63% of leaders, forcing a renewed focus on supply chain resilience. The survey highlights a move away from simply minimizing costs towards building more robust and diversified supply networks. This includes nearshoring, reshoring, and investing in alternative sourcing options.
The “trade reset” mentioned in EY’s analysis suggests a broader restructuring of global trade relationships, requiring Indian businesses to adapt quickly to changing conditions.
Beyond the Top Three: Changing Customer Demands and Talent Shortages
The survey also identified changing customer demands (49%) and talent shortages (64%) as critical risks. Meeting evolving customer expectations requires continuous innovation and a deep understanding of market trends. The talent shortage, particularly in areas like cybersecurity and data science, is exacerbating these challenges.
Rajeev Sharma, Chair of the FICCI Committee on Corporate Security & DRR, emphasized the require for adaptability: “In a business environment shaped by volatility, the ability to anticipate, absorb and adapt to risk is emerging as a defining capability for sustained growth.”
The Evolving Role of Risk Management
The report suggests a fundamental shift in how Indian companies approach risk management. Organizations are moving away from episodic risk assessments towards embedding risk management into strategic decision-making, governance structures, and long-term planning. This proactive approach is essential for navigating the increasingly complex and interconnected risk landscape.
Sudhakar Rajendran, Risk Consulting Leader, EY India, noted that risks are “converging rather than occurring in isolation,” requiring a more holistic and integrated approach to risk management.
Frequently Asked Questions
- What is the biggest risk facing Indian companies right now? Cybersecurity breaches are currently the top risk, cited by 51% of respondents in the FICCI-EY Risk Survey 2026.
- How are geopolitical events impacting Indian businesses? Geopolitical tensions are driving a need for greater supply chain resilience and diversification.
- What are the concerns surrounding AI adoption? Companies are worried about both the risks of not adopting AI (falling behind competitors) and the ethical and governance challenges associated with AI implementation.
- Is talent shortage a major concern? Yes, 64% of executives report talent shortages as a significant risk.
Pro Tip: Regularly assess your organization’s cybersecurity posture and invest in employee training to mitigate the risk of cyberattacks.
Did you know? 61% of leaders feel rapid digital changes are hurting their competitive edge.
Explore further insights on risk management and innovation by visiting the EY India website.
What are your biggest risk concerns for your business? Share your thoughts in the comments below!
