India scrambles to secure its place in US-China AI race, post-DeepSeek
For years, India has been a global hub for IT services, supplying skilled talent and software solutions that have powered technological advancements worldwide.
However, with artificial intelligence reshaping the industry, the country faces a critical challenge—can it transition to an AI-driven economy before falling behind?
The rise of Chinese AI start-up DeepSeek has intensified competition, challenging the dominance of Western technology. Experts argue that India must act swiftly to redefine its tech landscape or risk being overshadowed by AI powerhouses like the United States and China.
A recent report from the International Monetary Fund (IMF) warns that AI could impact nearly 40% of jobs globally. At the same time, India's software services sector, which holds a 44% share of the global market according to government estimates, is experiencing a slowdown, with projected annual growth of 11.9% through 2028.
In contrast, the AI sector is expected to expand at an extraordinary rate of 37.3% annually between 2024 and 2030, as noted by Raj Kapoor, founder and chairman of the India Blockchain Alliance.
Recognizing the urgency, India has taken steps to boost AI development. In March 2023, the government launched the IndiaAI Mission, a $1.25 billion initiative aimed at fostering start-ups and enhancing AI infrastructure. Additionally, a recent federal budget has allocated $575,000 to establish three AI education centers focused on research. IT Minister Ashwini Vaishnaw also announced that India’s own foundational AI model, tailored to its cultural and linguistic diversity, could be rolled out within months.
With AI shaping the future of global technology, India's ability to adapt and innovate will determine whether it can maintain its leadership in the digital economy or be left behind in the race dominated by the US and China.
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