Google Expands AI Marketing Tools to India Following Repeal of ‘Google Tax’
Google is launching its suite of AI-powered advertising tools in India after the government repealed the contentious ‘Google tax,’ signaling renewed cooperation between the tech giant and Indian regulators.
In a strategic move underscoring the growing importance of India in the global digital economy, Google has announced the expansion of its AI-powered marketing tools to the Indian market. The rollout follows the Indian government's decision to repeal the controversial Equalization Levy, colloquially known as the ‘Google tax’, which had imposed a 2% tax on digital services provided by foreign companies. The repeal marks a turning point in India’s digital policy and is seen as a gesture of goodwill towards global tech firms, encouraging greater innovation and investment in the country.
What’s Being Rolled Out?
Google’s suite of AI-driven marketing tools—previously available in key Western and APAC markets—includes: - Performance Max: An all-in-one campaign platform that uses AI to optimize ad placements across Google Search, YouTube, Display, Discover, and Maps. - Smart Bidding: Real-time AI-based ad bidding tailored to user behavior and conversion goals. - Auto-generated creatives: AI-generated video and image ads tailored to user engagement trends.
- Audience Signals: Predictive modeling tools to help advertisers reach high-intent customer segments. These tools are integrated into Google Ads and accessible to agencies, brands, and small businesses through a simplified dashboard. Why the Timing Matters
The expansion comes at a critical juncture.
India is one of the fastest-growing digital ad markets globally, with projections to surpass $15 billion in digital ad spending by 2026. Yet, international tech firms had faced policy friction due to the Equalization Levy introduced in 2020, which taxed digital services and ad revenues earned by foreign companies. Following pressure from global trade bodies and lobbying from major tech platforms, the Indian government recently agreed to phase out the levy in line with OECD-led global tax reforms, opening the door for deeper market participation.
Google’s Statement
In a press release, Google India’s Country Director Sanjay Gupta stated:
> “We welcome the policy clarity and are excited to bring our most advanced AI marketing capabilities to Indian advertisers. Our tools are built to empower businesses of all sizes to grow in a privacy-first, performance-driven environment. ”
He added that India is a "priority market" for Google’s AI advertising investments, citing a rising number of digitally native brands and regional entrepreneurs.
Boost for India’s Small Businesses
The AI tools are expected to be particularly beneficial for India’s large base of small and medium-sized enterprises (SMEs), many of which lack the resources for sophisticated ad campaign management. By using AI to automate and optimize campaigns, these businesses can: - Increase ROI with lower ad spend - Target hyperlocal audiences with better precision - Improve creative assets without hiring agencies
Google is also offering free onboarding workshops in Hindi, Tamil, and Bengali, signaling a push to democratize access across language and economic barriers. Industry Reactions
Digital marketing firms in India have broadly welcomed the move.
Radhika Mehra, founder of a Mumbai-based performance agency, said:
> “This opens up new doors for regional brands that have amazing products but lack the muscle to compete digitally. AI levels the playing field. ”
However, some privacy advocates have warned that increased ad personalization may raise concerns around data use and tracking, especially in the absence of India’s long-pending data protection law.
A Sign of Broader Trends
Google’s move mirrors a larger trend among Big Tech players recalibrating their strategies for India: - Meta has recently doubled down on WhatsApp-based commerce and ad tools. - Amazon has expanded its Made-for-India ad solutions for D2C sellers. - Microsoft is investing in low-code AI solutions for Indian developers.
With over 750 million internet users and rapid smartphone penetration, India is poised to become the testing ground for scalable AI ad tech in diverse, multilingual, and price-sensitive environments. Conclusion: A New Chapter in India’s Digital Ad Landscape
The repeal of the ‘Google tax’ has opened the floodgates for a new era of digital advertising in India. As Google unleashes its most powerful AI-driven tools to local businesses, the country’s marketers now have access to capabilities once reserved for Fortune 500 giants.
Whether this marks the beginning of more collaborative tech-policy dynamics or merely a temporary alignment of interests remains to be seen. But one thing is clear: India is now a central battlefield in the AI-powered marketing revolution—and Google is making its next big play.
