Private sector drives India's AI ambition with govt support, policies

The participation of startups and private companies in AI is not only limited to infrastructure, policy, or capacity building but also extends to skilling and other aspects as well

India’s ambition to make a mark on the global AI map is significantly driven by private players, including big techs and startups. This is also applicable for government-led programmes, including policy formation.  

Firms like Hiranandani group-backed Yotta Infrastructure are creating GPU-based compute capacity for different government departments, entities like Wadhwani AI Foundation are continuously advising the IT Ministry on artificial intelligence (AI) policies and its global AI approach. 

In a recent interaction with Business Standard, Nakul Jain, director of products and Programs, Wadhwani AI, said the firm was providing basic training and awareness to government officials around AI and emerging technologies, as a part of the capacity building exercise.

“For the India AI mission, we have an agreement with the Ministry of Electronics and Information and Technology (MeitY) and we have a dedicated team that works out of MeitY who are supporting the leadership in multiple initiatives of India AI,” said Jain.

He said, “Currently it’s a six to eight-member team, I think around four to five of them are based out of the ministry working day in, day out, well integrated, embedded, and then there are a few folks who are supporting from outside. The idea is to grow this team further because there are multiple opportunities and we’ve only very recently started.”

The Wadhwani team is helping the government in different AI-related initiatives. Creating the entire application layer or application pillar for the India AI mission and helping run the Global Partnership on AI (GPAI) initiative are some of the areas where it is contributing.

“There are a lot of events, there are a lot of policy pieces, concept notes that the government needs. So the team is helping the government organise some of these events, creating a framework to conduct these events,” Nakul said. 

Startups drive AI skills development

The participation of startups and companies, though, is not limited to the area of infrastructure, policy, or capacity building, but extends to skilling and other aspects as well. For example, tech giant Google, in July this year, announced a partnership with MeitY Startup Hub to train 10,000 startups in AI. 

This included providing up to $350,000 in Google Cloud credits to eligible Indian startups, enabling them to invest in the necessary cloud infrastructure and computational power, required in the field of AI.

Similarly, In February 2024, iCreate and Microsoft, facilitated by MeitY, signed a MoU to boost AI startups in India. The program will screen 1,100 AI innovators, focusing on Healthcare, Financial Inclusion, Sustainability, Education, Agriculture, and Smart Cities. 

Of these, 100 startups will be selected to scale using Azure OpenAI, with the top 25 receiving global go-to-market support from Microsoft’s network to develop advanced, competitive products.

Government funding spurs AI growth

Government support to the AI sector through the Rs 10,000 crore India AI mission is promoting private interest in the area, said experts.

In March this year, the Union Cabinet approved the IndiaAI Mission with an allocation of Rs 10,372 cr over the next five years, which included funding for establishing a computing capacity of more than 10,000 GPUs.

“These moves, along with the development of the broader ecosystem, accompanied by investments by the state governments, will help in establishing the necessary enabling infrastructure for the growth of Indian AI and Gen AI startups. These investments will overall help position India as a leader in AI research, development, and deployment,” Anjani Kumar, Partner, Deloitte India.

AI spending in India to triple by 2027

A recent Intel-IDC report said that Spending on Artificial Intelligence in the country may triple to $5 billion by 2027. Most of this investment and spending will be spearheaded by the private sector, say experts. 

“The explosive growth of AI in India underscores the ingenuity and ambition of the private sector and startups, which are at the forefront of innovation and investment. This surge in private sector engagement creates a dynamic ecosystem full of groundbreaking solutions and significant market potential, while also presenting the challenge of constant adaptation and scaling to stay ahead. The rise in AI startups reflects the sector’s expanding potential and a vibrant entrepreneurial spirit,” said a spokesperson from Tech Entrepreneurs Association of Mumbai. 

GROWTH DRIVERS

AI spending in India is set to treble by 2027 to $ 5 billion
 

India AI mission is giving boost to startups in the AI space, say experts
 

Companies like Yotta Data are creating compute infrastructure for government and other startups
 

Another private entity, Wadhwani AI, is assisting MeitY in AI policy and capacity building
 

Big techs like Google, and Microsoft are boosting AI skill development