Phase 1: Infrastructure set-up and initial outreach Objective: Create tangible demonstration facilities and testing environments, conduct initial outreach sessions to jump-start AI adoption 1 Establish the experience centre –Assess existing infrastructure such as technology centres, centres of excellence and incubation centres located close to the cluster –Develop a plan to transform existing facilities to form an AI experience centre –Develop cluster-relevant AI demos and develop ROI visuals/case studies Lead: MSME association (in collaboration with professional service providers, implementation partners) Outcomes: Functioning centre showcasing four to six high-value AI use cases 2 Launch cluster sandbox –Set up a sandbox environment in which solution providers can work on MSME- focused AI pilots –Establish partnerships with industry and academia to guide development and deployment of solutions Lead: MSME association (in collaboration with professional service providers, implementation partners) Outcomes: Operational AI sandbox fostering collaboration between MSMEs, solution providers, industry and academia 3 Outreach and initial workshops –AI 101 workshops, P2P sessions with early adopters –Case studies from similar sectors highlighting revenue and profit impact Lead: Local academia and MSME associations Outcome: Broad AI awareness and initial interest among MSME entrepreneurs Phase 2: Developing AI-readiness and capabilities Objective: Boost AI capabilities and AI-readiness among MSMEs 1 AI transformation index rollout –Select/develop an AI maturity assessment tool to map current AI maturity and suggest pathways to increase AI-readiness –Deploy the index and provide MSMEs with an AI transformation roadmap Lead: Local academia and MSME associations Outcomes: Cluster-wide mapping of AI-readiness along with clear next steps 2 Comprehensive training and upskilling –Conduct training sessions in AI usage, data handling and change management –Implement train-the-trainer programmes to scale capability-building activities Lead: Local academia Outcomes: Increased AI literacy and practical AI skills among MSME entrepreneurs and workers Transforming Small Businesses: An AI Playbook for India’s SMEs 47

Transforming Small Businesses 2025