Fuelling India’s AI ambitions: India has yet to establish itself as a frontrunner in artificial intelligence, but its potential to do so is undeniable. Microsoft Chairman and CEO Satya Nadella, speaking during his visit to India, highlighted the country’s unique advantages: a deep reservoir of mathematical talent and an expanding digital ecosystem. Nadella’s message was clear — India cannot afford to remain on the sidelines in the race for AI supremacy. While nations like the US and China have surged ahead with foundational AI models, India must seize this moment to invest in frontier research, build indigenous capabilities, and ensure it is a key player in shaping the AI-driven global future.
India has made significant strides in adopting AI across key sectors such as healthcare, agriculture, finance, and education. The rapid evolution of AI represents a transformational moment that will impact economies, productivity, national defence, and human culture. As AI reshapes global dynamics, India cannot afford to miss this opportunity.
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During a fireside chat with Jitin Prasada, Union Minister of State for Electronics and Information Technology, Nadella asked India to build its own AI foundational model using indigenous datasets. While acknowledging the significant costs involved, he underscored the strategic importance of such an endeavour. The world is in a brief ‘inter-AI’ period—a narrow window to shape the AI-enabled future. The US and China currently lead the race, while nations such as India, the UK, Israel, Japan, and South Korea are emerging players. To close the gap with leading AI leaders, India must act swiftly.
India’s AI ambitions
As the world’s most populous nation and one of the fastest-growing economies, India has a significant role to play in expanding the global AI ecosystem. The country has demonstrated its technological capabilities through milestones like its G20 presidency and the Chandrayaan-3 lunar mission. The global share of AI publications from India increased from 1.3% in 2010 to 5.6% in 2021, indicating progress in research and innovation.
Despite these achievements, India faces formidable challenges. One major hurdle is the energy demand of AI infrastructure. Advanced applications like large language models (LLMs) require immense computing power, and by 2030, AI-related infrastructure could consume an additional 100-200 terawatt-hours (TWh) annually—equivalent to the electricity consumption of a medium-sized country like Greece.
Scaling up renewable energy is essential to meet AI’s energy demands, but challenges such as the intermittent nature of solar and wind power and the lack of effective storage solutions persist. Modernising India’s power grid with smart grid technologies will require substantial investment to ensure consistent energy supplies for data centres. Without these upgrades, India risks power shortages that could disrupt AI operations and undermine its global competitiveness.
Building the foundation for AI success
AI has the potential to drive India’s economic growth and productivity, but this requires robust institutions, technological infrastructure, and internet connectivity for a significant portion of the population. With research and development (R&D) expenditure at less than 0.7% of GDP—far below the global average of 1.8%—India needs to substantially increase its investment in advanced technology sectors like semiconductors.
Equally critical is talent development. India must establish specialised education programs, foster partnerships with global tech companies, and enhance STEM education. Visits by global technology leaders like Satya Nadella present opportunities to incorporate their expertise into curricula, integrating AI, machine learning, and data science as core subjects.
Lessons from China
China’s AI progress offers valuable lessons for India. Despite US export controls on advanced semiconductors, Chinese companies like Alibaba and Tencent are producing competitive large language models. China has a robust and growing talent pool of AI researchers and engineers and benefits from heavy government investment in AI R&D.
India can take inspiration from China’s strategy while pursuing its own path. Forming innovation blocs, creating alliances, and fostering partnerships with dominant states or like-minded nations can accelerate India’s AI ambitions.
India’s AI strategy will have profound implications for the developing world and its relations with developed economies. For the country to realise its full potential in the 21st century, advancing AI must become a top priority for policymakers and stakeholders. With the right investments, strategic planning, and international collaboration, India can position itself as a global leader in AI and harness its transformative power for national development.