**India's AI Aspirations: The Race for a Foundational Model**

Sat Jul 26 2025 11:17:31 GMT+0300 (Eastern European Summer Time)
**India's AI Aspirations: The Race for a Foundational Model**

*As India's government invests in AI tech, experts warn that the country may be lagging in the race for innovation.*


*Despite a thriving startup ecosystem and international investment, India struggles to create its own foundational language model, facing challenges in research and policy.*

India is making significant efforts to break through in the realm of artificial intelligence (AI), but experts caution that the country may not be keeping pace with the rapid advancements seen in other nations, particularly the US and China. Two years following the explosive popularity of ChatGPT, China's foundational language model DeepSeek has not only set a new standard for AI performance but has also dramatically reduced development costs for generative AI applications.

Currently, India does not have its own equivalent to DeepSeek, a potential setback in the increasingly competitive global AI landscape. While the Indian government is optimistic about delivering a homegrown language model, it acknowledges the necessity of providing advanced computational resources, including thousands of high-end chips, to various stakeholders such as startups and educational institutions to meet this target within the next ten months.

Global AI leaders have recently highlighted India's potential. Sam Altman, CEO of OpenAI, has shifted from skepticism to advocating for India's prominent role in the AI revolution. OpenAI now counts India as its second-largest market. Additionally, significant investments from tech giants like Microsoft, which has earmarked $3 billion for AI infrastructure in India, and Nvidia’s acknowledgment of India’s technical prowess underscore the country’s promise.

Despite this buzz, experts emphasize that a lack of educational and structural reforms could hinder India's ambitions. China and the US have established a commanding lead, having allocated substantial resources toward military, legal, and computational AI applications over the years. In the realm of AI patents, from 2010 to 2022, the US and China garnered the lion's share of approvals—60% and 20% respectively—while India managed to secure a mere fraction.

Furthermore, India's private sector funding for AI startups lags behind both American and Chinese counterparts, with state funding initiatives appearing minuscule by comparison. The Indian government is currently invested in an AI mission valued at around $1 billion, dwarfed by the billions allocated by the US for advancing AI technologies.

The Indian market's landscape is riddled with challenges, notably in obtaining high-quality datasets tailored to regional languages such as Hindi or Tamil, a necessity for robust AI training. Additionally, despite India's standing as a talent-rich nation—15% of the global AI workforce is Indian—research-driven innovations are not translating into breakthroughs that can establish foundational models.

To see progress similar to the digital payment revolution facilitated by successful collaboration among government, industry, and academia, experts suggest that the same model needs to be applied to India's AI initiatives. The nation's information technology sector, despite its substantial growth, remains entrenched in service-based models rather than foundational technology development.

While startups are vital to India’s AI future, some analysts remain skeptical about whether these entities can quickly scale up to compete effectively. The ambitious timeline set by the government appears reactionary in light of recent advancements by competitors like DeepSeek.

However, there are avenues for India to enhance its AI capabilities by leveraging existing open-source technologies. In the long term, creating an indigenous foundational model will be crucial for achieving strategic independence in AI, reducing reliance on foreign technologies, and diminishing vulnerability to external economic pressures.

To continue advancing its goals in AI, India needs to bolster its computational capabilities and enhance its infrastructure, particularly in semiconductor manufacturing, ensuring synergy between innovation and regulation. These elements will be critical in closing the gap with leading global players in the AI domain.

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