Govt likely to push for use of domestic AI models in critical sectors

The government may ask critical sectors such as defence and aerospace to prioritise indigenous AI models and avoid using frontier systems developed by foreign companies

AI, Artificial Intelligence
India is looking to expand the use of homegrown artificial intelligence models in critical sectors, including defence and aerospace, as it seeks to strengthen domestic AI capabilities and reduce reliance on foreign technology. (Photo: Reuetrs)
Aashish Aryan New Delhi
3 min read Last Updated : Nov 09 2026 | 11:30 PM IST
The central government is likely to push for greater use of indigenously developed artificial intelligence (AI) systems, large language models and AI-powered agents, especially in government-owned and -run critical sectors such as defence and aerospace, senior government officials said.
 
This could include asking critical government departments, both at the central and state levels, to completely avoid using frontier AI models and agents developed by non-Indian companies, an official said.
 
Some sectors, such as defence, which are already working on and developing their own air-gapped large language model systems that can work on the edge, have also been asked to review ways in which AI systems and agents developed indigenously under the IndiaAI Mission can be used and deployed, the official said.
 
Under the ₹10,372 crore IndiaAI Mission, the government has identified and approved the development of 20 models, which include general-purpose large language models (LLMs) and specific sector-focused small language models (SLMs).
 
These foundational models, LLMs and SLMs are being developed by 12 startups whose projects have been approved by the government under the IndiaAI Mission. These include Sarvam and BharatGen, both of which have so far released several AI models.
 
In addition, a video-generating AI model called Varya and foundation models EKA-1 by Soket, as well as Dhir 2B and Dhir 5B developed by ZenteiQ, have also been released.
 
Other companies such as Gnani, Gan AI, Fractal, Tech Mahindra and Shodh AI, all of which are among those selected to develop indigenous AI models, are also working to release LLMs and SLMs over the next 12-15 months, one of the officials quoted above said.
 
“The idea is to have enough technological capability to use these models in crucial sectors. We are in constant talks with all the companies (who won bids to develop indigenous AI models) to see if we can expand the scope of the models they have built so far,” the official said.
 
The official added that some of the domestic models developed so far had achieved up to 80 per cent of the capacity of leading frontier AI models.
 
The IndiaAI Mission, approved in March 2024, aims to catalyse various components, including pivotal initiatives such as IndiaAI Compute Capacity, IndiaAI Innovation Centre, IndiaAI Datasets Platform, IndiaAI Application Development Initiative, IndiaAI FutureSkills, IndiaAI Startup Financing and Safe & Trusted AI. It also seeks to nurture the country’s AI innovation ecosystem through a public-private partnership model.
   

One subscription. Two world-class reads.

Already subscribed? Log in

Subscribe to read the full story →
*Subscribe to Business Standard digital and get complimentary access to The New York Times

Smart Quarterly

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Exclusive premium stories online

  • Premium stories handpicked daily by our editors

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

Topics :artifical intelligenceartificial intelligence and roboticsFuture of AI infrastructureDefence newsAerospace and Defence policy

First Published: Nov 09 2026 | 11:30 PM IST

Next Story