AI agents have the potential to create significant value for large and small organizations alike. In the context of Indian SMEs, AI agents hold the promise to simplify their AI journey. Unlike complex AI systems, AI agents typically do not require technical expertise due to their low-code/no-code interface. Agents also present an affordable way for SMEs to integrate AI into their workflows since they are modular and can be incrementally scaled as and when the need arises. They can empower SME workers by gathering insights and taking action, thus unlocking deeper automation through an agent workforce. AI agents can generate substantial value for SMEs in India by helping them increase their output, improve efficiency and reduce costs. They can achieve this through three broad levers: 1. Enabling data-driven workflows: AI agents can integrate data from multiple sources, analyse the data and enable optimized data- driven workflows that adjust dynamically using real-time data. 2. Automating business operations: Agents can operate autonomously with minimal or no human intervention, increasing efficiency and reducing errors. 3. Empowering the workforce: AI agents can work alongside the human workforce, complementing their skills and increasing productivity and decision quality. They can thus enable workers to focus on high-value strategic tasks. It is important to acknowledge the impact of AI agents on the workforce. As these agents enable deeper levels of automation, the role of human workers will inevitably evolve. While many routine tasks currently handled by employees may become automated, this shift will also create opportunities for workers to focus on more strategic, creative and value-added responsibilities. The role of workers will thus transition from hands-on operators to AI-enabled orchestrators (see Frontier Technologies in Industrial Operations: The Rise of Artificial Intelligence Agents). AI agents can therefore increase AI adoption in Indian SMEs by making implementation simpler and demonstrating real value impact on business operations. To inspire SME organizations to adopt AI agents, three high-impact use cases for AI agents are described below, using examples of real organizations and presenting an illustrative AI agent workflow for them. 1 AI agent application: Export documentation and compliance Indian MSMEs play a crucial role for the country’s export sector and are responsible for approximately 45% of total exports.26 Over the past few years, MSME exports have witnessed a significant growth, with a compound annual growth rate (CAGR) of 19%, rising from $88 billion in 2020–2021 to $126 billion in 2022–2023.27 This is reflective of the potential of Indian MSMEs to expand exports further and strengthen India’s position in global trade. However, despite this potential, Indian MSMEs continue to lag behind peer countries such as China, where MSMEs contribute more than 60% to overall exports. Furthermore, MSME e-commerce exports in China amount to more than $200 billion, which is far greater than India’s $2 billion. Indian SMEs face multiple bottlenecks in the export process that hinder their ability to scale quickly. The export process requires coordinating among many stakeholders – including banks, logistics providers and customs house agents (CHA) – which creates a resource burden on SMEs. The process is further complicated by complex regulations, which involves submitting compliance documentation to several regulatory authorities such as the Indian government’s Directorate General of Foreign Trade (DGFT), trade bodies, customs and goods-and- services tax (GST) authorities. These regulations are updated regularly, which means SMEs need to dedicate resources to understand these evolving regulations and prepare new compliance documents accordingly. All of this is time-consuming and leads to delays in the export process. Some metrics illustrate the magnitude of this challenge. India ranks 68th in the World Bank’s Trading Across Borders index,28 which ranks countries based on the time and cost associated with export and import processes. Border compliance in India takes around 52 hours, which is more than double the 21 hours in China. Similarly, documentary compliance takes about 12 hours compared to nine hours in China. AI and AI agents can streamline and automate the complex export process for SMEs, enabling them to focus on more strategic parts of the business. Use case 1 illustrates how AI agents can help SMEs with their export process. In the context of Indian SMEs, AI agents hold the promise to simplify their AI journey. 33 Transforming Small Businesses: An AI Playbook for India’s SMEs33

Transforming Small Businesses 2025