Unequal AI Adoption & Widening Inequalities in Asia Pacific

Syllabus: GS3/Economy, Employment, GS4/Impact of AI on Society

Context

• According to a recent United Nations report, the Countries across the Asia-Pacific region face unequal starting points, highlighting deep divides in digital and economic readiness.

Artificial Intelligence (AI) Adoption

• According to a new UNDP flagship report, it has seen one of the fastest technological adoptions in history, reaching 1.2 billion users in just three years.
  • Nearly 70% of these users are in developing countries, but the global distribution remains highly uneven.
  • Two-thirds of people in high-income nations already use AI tools, but usage in many low-income economies remains close to 5%.

Understanding the Divergence in AI Adoption

• AI can boost economic growth, enhance public services, expand opportunities, and strengthen resilience.
  • But, without inclusive adoption, it may also deepen divides, amplify exclusion, and weaken governance.
• Countries that possess the right mix of connectivity, digital skills, computing capacity, and regulation will capture most of the AI dividend.
  • Meanwhile, others risk facing job disruption, data exclusion, misinformation, and even resource strain due to the rising energy and water demands of AI systems falling behind.

AI Adoption Across Asia-Pacific: Promise and Peril

• AI and People:
  • Bhutan is piloting AI tutors to personalize school learning.
  • Mongolia’s AI-driven credit scoring has provided $70 million in micro-loans to nearly 4,000 small businesses.
  • Viet Nam’s digital farming tools reach 39 million farmers with real-time agricultural data.
  • Northeast India’s AI flood-forecasting systems have doubled prediction accuracy, saving lives and property.
  • However, above advances coexist with persistent inequalities, like:
    • 1.6 billion people in the region cannot afford a healthy diet.
    • 27 million youths remain illiterate.
    • Women in South Asia are 40% less likely than men to own a smartphone.
    • Rural and minority groups remain largely invisible in the datasets that train AI models.
• AI and the Economy:
  • AI could lift global GDP growth by around 2 percentage points annually and increase productivity by up to 5%, if scaled effectively, in key sectors such as finance and healthcare.
    • For example, ASEAN economies could gain nearly $1 trillion in additional GDP over the next decade.
  • These gains come with significant labor market disruptions, like:
    • 75% of firms expect job losses even as new AI-related roles emerge.
    • Female workers are twice as exposed to automation risks compared to male counterparts.
    • Informality remains high, with 88% of jobs in India and 60% in Indonesia lacking formal protections, heightening vulnerability to displacement.
• AI and Governance:
  • Bangkok’s Traffy Fondue platform has processed 600,000 citizen reports efficiently.
  • Singapore’s Moments of Life app reduced new-parent paperwork from 120 minutes to just 15 minutes.
  • Beijing’s digital twin systems simulate urban growth and flood risks in real time.
    • However, regulatory frameworks lag behind technological advances. Only a handful of countries have comprehensive AI laws, and many systems remain opaque ‘black boxes’.
    • By 2027, an estimated 40% of global AI-related data breaches could stem from the misuse of generative AI, underscoring urgent governance challenges.
• Gaps in AI Preparedness: The AI Preparedness Index, developed by the International Monetary Fund (IMF), reveals disparities in readiness across the Asia-Pacific.
  • Advanced economies like Singapore, South Korea, and China score above 70%, reflecting robust digital infrastructure, strong innovation ecosystems, and proactive regulation.
  • Fragile and low-income states, by contrast, score below 20%, lacking reliable electricity, data systems, and connectivity needed to fully participate in the AI revolution.
  • These regional divides are compounded by inequalities within countries, where income and wealth remain concentrated among the top 10%, leaving large segments of the population excluded from technological progress.

Way Forward: Building Inclusive AI Futures

• Building the Foundations for Inclusive AI: The UN report emphasizes that inclusive AI adoption depends on strengthening both hard and soft foundations.
  • Hard foundations include affordable and reliable internet access, clean and stable electricity, and cooling and computing resources.
  • Soft foundations include human capital development through education and upskilling; effective public institutions to guide digital transformation; and robust legal and ethical frameworks to ensure fairness, privacy, and trust.
• UNDP’s Call to Action: The UNDP urges immediate global and national action to bridge the AI divide:
  • Invest in digital infrastructure and connectivity;
  • Strengthen AI-related education and skills;
  • Develop ethical and safety regulations;
  • Promote sustainable and energy-efficient compute;
  • Foster regional and global cooperation on standards and open-source AI models;