India commits ₹10,372 crore over five years to boost AI infrastructure and startups

Artificial Intelligence, technology.

India unveils a new AI supercomputing resource accessible to startups, academia, and industry, aiming to accelerate research and development in the field. The country’s AI market is expected to reach $17 billion by 2027.

India has announced plans to invest Rs 10,372 crore over five years in a variety of artificial intelligence (AI) projects, asserting its position in the rapidly growing sector.

The funding will be utilized for establishing computing infrastructure and supporting AI startups, according to a statement from the Ministry of Information Technology issued late Thursday.

The AI mission will be executed through the IndiaAI Independent Business Division (IBD) under the Digital India Corporation (DIC). Union IT and Communications Minister Ashwini Vaishnaw emphasized that Prime Minister Narendra Modi has made technology more accessible and will now make compute power available to innovators, startups, students, and educational institutions through this AI mission.

The mission aims to provide access to supercomputing capacity, which includes over 10,000 GPUs (graphics processing units), to stakeholders for building an AI ecosystem. GPU-based servers are in demand for their ability to process data at a higher speed compared to CPU-based servers.

Under the India AI Mission, startups, academia, researchers, and industry players will have access to the AI supercomputing infrastructure. Minister of State for Electronics and Information Technology Rajeev Chandrasekhar stated that this investment will enhance India’s AI ecosystem and establish it as a significant player in shaping the future of AI, both domestically and globally.

India’s Cabinet has approved the establishment of an India AI Innovation Centre (IAIC) as part of the AI mission. The IAIC will serve as a leading academic institution, overseeing the implementation of the mission and retaining top research talent.

Funds allocated by the Cabinet will enable the IAIC to lead the development and deployment of foundational models, with a focus on indigenous Large Multimodal Models (LMMs) and domain-specific models. This initiative will leverage edge and distributed computing for optimal efficiency.

Additionally, the financial outlay will strengthen the India AI Startup Financing mechanism, facilitating easier access to funding for emerging AI startups and accelerating their journey from product development to commercialization.

Furthermore, the proposal includes funding provisions for industry-led AI projects aimed at driving social impact, fostering innovation, and promoting entrepreneurship.

To improve the quality of data and make it available for AI development and deployment, a National Data Management Office will be established under the mission. This office will collaborate with various government departments and ministries.

The government’s working groups on AI have recommended the establishment of a three-tier compute infrastructure, comprising 24,500 GPUs, to support AI technology development in India.

India’s AI market is projected to reach USD 17 billion by 2027. However, challenges such as job displacement due to AI models threaten to impact the workforce, particularly in the software services industry.

Currently, US and China lead in AI computing infrastructure. China had 162 supercomputers, US had 127 and India had three, according to the Top 500 list issued in November 2022.

NVIDIA dominates the GPU market with an 88% market share, leading to a 12–18 month delay in acquiring GPUs due to high demand worldwide.

The government has already invested Rs 1,218.14 crore over the past eight years to establish 24 PetaFlops compute capacity under the National Supercomputing Mission.

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Indian entrepreneurs and companies may face challenges in developing AI products without significant financial backing, according to OpenAI chief executive Sam Altman.

Both the public and private sectors in India have made initial efforts to create AI applications. A partnership between Reliance Industries and top Indian universities is expected to launch a ChatGPT-style chatbot application this month.

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