Climate change is a pressing challenge in agriculture and water resources, especially in developing countries like India. To address these challenges, precision agriculture and integrated water management have emerged as a part of UN sustainable development goals (goal 13—climate action). The growth of AI in precision agriculture and integrated water management in the last decade enabled crop yield optimization, water use analysis, and flood and drought susceptibility prediction in agricultural fields and water bodies. This detailed review reveals that AI has significant potential to support climate action by providing accurate estimates on irrigation, water quality monitoring, and climate impacts. However, specific challenges, such as data access, availability, and quality, must be addressed to improve the AI’s performance. This study highlights the need for extensive research on increasing data availability in India’s agricultural systems and water resources.