While the U.S. and China focus on enormous AI models that won’t deliver value, India is going another way.
The digital economy there is worth $1 trillion and is the back office of U.S. tech. . The domestic economy is worth $3.5 trillion and is growing at 7%.
There are a host of successful Indian ex-pats to emulate. The leaders of Microsoft, Google and Adobe are all Indian American. About 10% of U.S. tech companies are Indian-led, and companies they run have a market cap of $6 trillion.
Education, motivation, imagination, capital, youth – all the ingredients that drove U.S. tech to the top, are present in India. There’s also an entrepreneurial culture, which is behind the political dominance of the BJP party
Indian development represents an alternative to the top-down approach to AI of China and the U.S. India has a bigger creative class than the U.S. They’re younger, scrappier, and hungrier than their elders in Silicon Valley. It’s now 7th in AI startups but that’s 7th with a bullet.
India’s Creative Class
Analytics India lists dozens of Indian AI startups. I suspect Wikipedia’s own article on the subject is behind the curve, listing a lot of tech leaders that are decades old.
That’s now where the future is happening. Inc42 is tracking over 100 startups and the group has already launched its first “unicorn,” with Krutrim now worth over $1 billion. Most are based in Bengalaru, known here as Bangalore, a sprawling LA-like city on the country’s southern plateau, equidistant from both coasts.
The start-up culture gets pushback for demanding 60 hour weeks but Daksh Gupta, whose Twitter posts started the discussion, says he was describing San Francisco as much as Bengalore.
India’s Approach to AI
It’s clear now that “big AI” models won’t deliver value as they scale. I wrote this a year ago, when I called AGI the first “lie of the year” here. Attention is moving toward smaller models, smaller databases, and point solutions, where entrepreneurs have a big advantage.
While American companies write about how they’ve captured Indian tech’s attention with their fancy chips and pseudo open source, Indian programmers are focused on simpler tools.
It’s a niche that may be India’s to own. The failure of the Internet of Things, due to its inability to drive revenue, means there’s a clear field for “tiny AI” experimentation. I think it’s in “tiny AI,” a layer that can let your toaster tell your fire alarm that the smoke from your burnt breakfast isn’t dangerous, or that can translate speech to text locally, that Indians will gain traction.
Point to India.
