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Two By Two Fri, 16 May 25 |
An abridged, narrative version of the latest episode of Two by Two, The Ken’s premium weekly business podcast. |
India's AI program is unlikely to create unicorns. Where should India focus its efforts in the AI race now?
| 4 min read |
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I find most discussions and debates around AI… kind of tiring.
Don’t get me wrong. I was as excited (and apprehensive) as anyone else about what AI portended for the nature of not just work, but life when the first Gen AI launches hit the headlines. By now though, after thousands of videos, podcasts, articles, and reports painting AI as the big solution to every problem under the sun, I find my enthusiasm for the topic a bit dulled.
But there’s a good reason why AI has occupied so many minds and conversations this past year, and will continue to do so. Because by now, regardless of how tired the topic makes me, it’s also obvious that AI really is one of the most consequential breakthrough technologies in many, many decades.
No wonder that everyone wants a piece of it.
India’s establishment—whether business, government, or academic—doesn’t want to just stand by and watch either. But most efforts we’ve seen from them so far feel more impulsive than well-thought-out.
When countries across the world saw what OpenAI did, they realised they needed their own AI models to protect their interests. But sticking the landing on these big shifts is hard, and India has already missed the AI bus on multiple fronts—from the creation of foundational models to building applications on top of AI models to setting up data centres and managing our own sovereign data sets.
So, what does India build in AI now?
That was one of the big questions Two by Two hosts Rohin Dharmakumar and Praveen Gopal Krishnan wanted to discuss in our latest episode. And to answer it, we had two sharp and perceptive guests—Srinath Mallikarjunan, CEO and chief scientist at Unmanned Dynamics, and Nitin Pai, co-founder and director of Takshashila Institution.
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Changing goal posts
Given how fast things move in the AI world, changing your goals and narratives becomes necessary, especially if you’re playing catch-up like India is. And all the entities that need to come together and shape this mission—the government, academic institutions, businesses—seem to be at odds with each other.
If you ask our guests, this is largely due to how we see research and development in our country.
Srinath: Let me give you specific examples.
I’m willing to wager on the kind of apps that companies are developing in India. Most probably, they would be reading consumer financial data to see how they can disperse loans, how they can send their loan sharks more effectively, or how they can sell more things to people.
This is the mentality.
Rohin: What does it mean when you say that’s ‘the mentality’?
Nitin: It’s more about short-term gain. Like, I open a lemonade stall, I make lemonade for Rs 10, sell it for Rs 12, or even Rs 8.
It’s not long-term.
It’s not like this is a real technological problem that needs to be solved.
There is this competition, which is making this product that sells for $10,000 a licence. So let’s make a product, a superior product, and sell it for $5,000 a licence.
That’s not how it goes.
In short, the way most Indian entities approach technology is by following the path of least resistance, which is hardly the best way of developing truly disruptive solutions.
Srinath also offered an example of what could be possible if things were done right.
Srinath: There is a company called Altium. It makes PCB design software. Extremely expensive.
Similarly, there’s a company that makes computational fluid dynamics software called Ansys. These are all foundational companies in their respective fields.
We don’t hear about them because most Indians only use them as consumers. They don’t contribute to the code. However, these products themselves could be made better by using AI.
When you design a PCB, there’s a lot of manual work involved, and it depends on the type of PCB that you’re designing, whether it be for power electronics, RF communication, and so on.
In India, try pitching this to a VC.
They’ll point to the market size, and say you have no way of getting traction against Altium. So they won’t fund you.
A hesitant helping hand
In last week’s edition of Make India Competitive Again, my colleague Abhirami wrote about how the government is trying to lend a helping hand to businesses developing AI products. Well, to one business at the moment, anyway.
But not much seems to be happening, especially when it comes to government aid for smaller, yet talented startups and people working on AI solutions.
Srinath: Let me address the fundamental problems which I think are holding back India in the larger electronic space. And then we can talk more about OpenAI, for which, of course, you need GPUs and stuff.
Let’s talk about something practical.
Customs duty.
If I want to make PCBs in India, whether with GPUS or with just microcontrollers, it takes me three working days to get the product from the US—let’s say DigiKey or Mouser or wherever—to Bengaluru.
And then in Bengaluru, customs will invariably keep it around for a week or 10 days where they’ll have some procedure or the other and delay things.
This is not how it used to be about 10 years ago.
It’s become worse.
And classic Indian jugaad will only take you so far.
So where does this leave India?
Some answers did come out of the discussion, and none of them are particularly easy to execute. But they are what India needs to do to break out of the rut it’s in.
You can listen to the full episode here.
Write to us at [email protected] with your thoughts and suggestions, and we’ll see you again next week.
Regards,
Hari Krishna
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Hari works as a producer and researcher on Two by Two and First Principles. He’s from a “little village in Kerala where nothing much happens”, enjoys reading books (although he loves buying them even more), and appreciates films—be it on Netflix or Criterion.
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