China’s DeepSeek AI recently accelerated the global AI race by launching a ChatGPT-like algorithm at a fraction of the cost, transforming the competition within the tech behemoths. Artificial Intelligence (AI) innovations are not about creating economic dominance; they are focused on securing technological independence. Therefore, India cannot afford to be a mere spectator in this high-stakes game.
India ranks third in AI research after China and the US and fourth in the Global AI Vibrancy Rankings. According to Niti Aayog, AI is expected to boost the annual growth rate by 1.3% by 2035, adding $1 trillion to the economy. The country’s AI market is driven by the vast pool of skilled workforce and professionals in STEM fields. They are relentlessly working to create AI algorithms, applications, and solutions across industries to fulfil the evolving demands of the domestic and global markets.
The country’s national AI strategy focuses on innovation, ethical governance, and global collaboration. The government is fostering partnerships between academia, private enterprises, and startups to propel AI applications in governance and critical sectors such as healthcare, agriculture, smart cities, and space exploration. It has launched policy initiatives to ensure access to AI, foster innovation, accelerate development, and empower communities. The IndiaAI Mission, with a budget outlay of just over Rs. 10,000 crore, establishes a comprehensive ecosystem that will catalyse AI innovation through strategic programmes and partnerships across industries. Similarly, Startup India supports entrepreneurship and innovation among budding businesses, including AI-driven startups, further strengthening market growth.
Before India’s AI revolution, domestic companies used internationally developed AI-powered technologies that threw challenges in areas such as seamless integration, higher efficiency, and greater output in the existing business models. But homegrown startups are changing the market. The government’s attempt to construct India’s first homegrown AI fundamental model, backed by the AI Mission, will further fuel the revolution. India’s first AI Data Bank will support the initiative to accelerate technological growth and innovation by providing researchers, startups, and developers access to high-quality, diverse datasets essential for creating scalable and inclusive AI solutions.
Further, the government is promoting indigenous AI models, such as Large Language Models (LLMs) and Small Language Models (SLMs), tailored for Indian languages and specified challenges to ensure that the indigenously developed AI is culturally sensitive and relevant. The industry’s vision, however, is broader, i.e., to build an ecosystem in which AI development flourishes at scale, fostering creativity in government, industry and commerce. It is driven by a thriving AI startup culture focusing on niche AI applications such as NLP, computer vision, and AI-powered analytics, catering to focused industry needs. As the segment continues to evolve and encompass global demand, it drives companies to innovate, deliver cutting-edge solutions, and stay ahead of their compatriots.
Meanwhile, the Economic Survey 2024-25 explores potential opportunities for the youth in this upcoming segment, creating a new social infrastructure that promotes an environment where innovation leads to inclusive growth. While there are growing concerns about job displacement, it also opens avenues for upskilling and training the human intellect for more advanced roles. The government is already working in this direction through initiatives such as Skill India Digital Hub, skill certification schemes, etc., with the vision to promote ‘Augmented Intelligence’, where the workforce integrates both human and machine capabilities to improve overall efficiency in job performance.
Today, India has successfully built a ‘Digital Public Infrastructure’ for over 1.4 billion people at a very low cost and around an open and accessible network. We have the world’s largest biometric database (Aadhaar), a booming UPI payments network, and a rapidly increasing digital health ecosystem. When used appropriately, this data can power AI models that accurately reflect our global standing. Now, the government has to ensure computing access, improve data quality, expand Indigenous AI capabilities, and enable successful industry collaboration to secure socially impactful AI projects and push ethical AI, achieving inclusive growth of India’s AI ecosystem.
While the next decade will determine India’s position as an AI powerhouse in the global market, the government is making all the right moves, pushing Indigenous AI models and deep tech startups and promoting AI-led governance. To boost AI computing capability, the National Supercomputing Mission has created 33 supercomputing systems with a total capacity of 32 Peta Flop across locations in the country. Under the National Quantum Mission, four thematic hubs have been mandated to include technology development, human resource development, entrepreneurship and international collaborations. At the same time, the National Mission on Interdisciplinary Cyber-Physical Systems has set up 25 technology innovation hubs in institutes and across advanced technology verticals. The government has also initiated the AIRAWAT project to provide a shared computing platform for AI research and knowledge assimilation.
AI has the potential to become the backbone of India’s tech advancement, capable of driving economic growth and addressing challenges in areas such as sustainable development, public service delivery, and national security. To better understand how Artificial Intelligence influences economic growth and boosts India’s global competitiveness in this critical segment, plan a visit to the 32nd Convergence India and 10th Smart Cities India expo co-located with the inaugural AI Bharat expo, scheduled from 19-21 March 2025, at Pragati Maidan, New Delhi, and experience how big corporations, startups, organisational leaders, think tanks and innovators shape India’s journey.
About Convergence India & Smart Cities India expos
The Convergence India expo, in its 32nd edition, has played a pivotal role in accelerating the telecommunications revolution in India over a three-decade period. Over the decades, the expo has continued to showcase innovation and advancements in the fields of telecom & IT, communications, broadcast, satcom, mobile & accessories, IoT, embedded tech, fintech & AI, and showcase India’s emerging role as a leader in technology and empowerment. Meanwhile, the Smart Cities India expo, in its 10th edition, has been pivotal in driving forward the Smart Cities mission, and working towards a more sustainable and citizen friendly future.
