The average cost of a data breach in India has reached an all-time high of ₹220 million in 2025, a 13% jump from last year’s ₹195 million, according to the latest Cost of a Data Breach Report released by IBM.
The study, which analyzed nearly 6,500 data breaches globally, highlights that while AI adoption is racing ahead, security and governance measures for AI are lagging dangerously behind. This is the first year the report has examined AI-related breaches, revealing that AI systems are already becoming high-value targets for cybercriminals.
In India, only 37% of organizations have AI access controls in place, while nearly 60% lack fully developed AI governance policies. This security gap is proving costly—especially with the rise of “shadow AI,” where AI tools are deployed without IT oversight. The report found shadow AI to be one of the top three cost drivers for breaches in India, adding an average of ₹17.9 million to the damage.
“India’s accelerating AI adoption brings immense opportunity, but it’s also exposing enterprises to new and complex cyber threats. The absence of access controls and governance is not just a technical oversight—it’s a strategic vulnerability. CISOs must embed trust, transparency, and governance into AI systems by design,”, said Viswanath Ramaswamy, Vice President, Technology, IBM India & South Asia.
India-Specific Highlights from the 2025 Report
AI Governance Gaps – Nearly 60% of breached organizations lack AI governance policies or are still developing them. Only 34% of those with policies actually deploy AI governance technologies.
Shadow AI Costs – Shadow AI added an average of ₹17.9 million to breach costs; only 42% of organizations have policies to detect or manage it.
Top Breach Causes – Phishing (18%), third-party/supply chain compromises (17%), and vulnerability exploitation (13%) were the leading attack vectors.
Sectoral Impact – Research faced the highest average breach cost at ₹289 million, followed by transportation (₹288 million) and industrial (₹264 million).
Faster Breach Detection – The average breach lifecycle in India dropped to 263 days—15 days faster than last year—due to quicker identification.
AI in Security Still Underused – Despite evidence that AI-driven security can cut breach costs by more than half, 73% of Indian organizations reported limited or no use of such tools.