Amidst rapid advancements within the AI industry in India, finance minister Nirmala Sitharaman is set to present the 2024 Union Budget on July 23.
Expectations are high this year, especially as the government has taken multiple strides in partnering with industry leaders, including NVIDIA, to improve the sector as a whole. This includes the IndiaAI Mission, under which the focus has been the procurement and rental of GPUs for the benefit of Indian startups.
In February this year, Sitharaman had presented the interim Union Budget. This iteration of the budget laid down several broad points on improving support for research in the fields of AI and machine learning, introducing policies for data governance, and the overall improvement of infrastructure to support the rapidly growing industry.
With major funding also provided to the IndiaAI mission (a whopping INR 10,371 crore), many are hoping for the potential expansion of the mission and continued focus on improving the infrastructure needed to build AI in India.
Contrary to previous budget presentations, Sitharaman emphasised a larger than usual focus on AI development and infrastructure in the interim budget. As much as INR 4,500 crore was earmarked specifically to provide AI startups with the computing infrastructure they need.
There was an overall focus on improving the AI ecosystem, this included the significant funding towards infrastructure as a whole.
In the 2022 budget presentation, Sitharaman had conferred data centres with “infrastructure status”, which means that any funding towards infrastructure by default also means the improvement of data centres within the country. This was further strengthened by the proposal of the 2020 Data Centre Policy.
Apart from the policy, there were underlying proposals in the interim budget that meant a strengthening of foundations within the industry, including the establishment of three Centres of Excellence (CoEs) that will focus on AI research, as well as INR 255 crore earmarked for their establishment.
Prime Minister Narendra Modi has spoken much about AI this year, emphasising the need to make use of AI and ML to improve digital infrastructure in the country. This reflected a need by industry leaders who are vying to integrate AI within their current ecosystems.
“Embracing AI in manufacturing will drive innovation, efficiency, and cost-effectiveness. This will enable Indian products to compete globally, harnessing the country’s economic potential, empowering its youth, and strengthening its global position,” said Avneet Singh Marwah, the CEO of Super Plastronics.
Similarly, Anurag Gupta, the co-founder of STEMROBO, a startup that provides an educational robotics platform for STEM learning, said of the education sector, “We expect major investments in integrating artificial intelligence (AI) and advanced information and communication technology (ICT) into India’s education system.”
AIM has also reported extensively on industry leaders integrating AI within different sectors apart from manufacturing, including the service sector, healthcare, defence, and even aerospace, with several startups coming up to fill these gaps.
On the flip side, the government has approved proposals to improve the underlying infrastructure in India.
“We look forward to continued support and investment in AI solutions that benefit society and foster collaboration between academia and industry. Our long-term vision for AI in India aims for widespread integration across sectors, empowering citizens with AI tools tailored to local needs,” said Wadhwani AI CEO Shekar Sivasubramanian.
However, apart from an increase in research and a collaboration between the academia and industry, other industry leaders believe another core aspect of AI development should be the further encouragement of public-private partnerships, on similar lines to India’s GPU deal with NVIDIA.
“We advocate for increased incentives for public-private partnerships, which are essential for scaling AI technologies to serve wider demographics, including SMEs.
“These partnerships can democratise access to advanced AI solutions, ensuring that businesses of all sizes can leverage technologies to enhance operational efficiency and customer satisfaction,” said Sarvagya Mishra, the co-founder of Superbot, a Haryana-based startup which specialises in AI-powered conversational assistants for enterprises.
Overall, however, the focus seems to be on a need for clarity. As mentioned before, the earmarking of INR 4,500 crore was a welcome move for AI computing infrastructure, but how exactly these funds would be utilised was unclear.
“As we await the full budget, we expect clear and decisive provisions to advance this vision, with technology at the heart of this transformation.
“While technology continues to drive India’s socio-economic progress, the key lies in building the nation into the knowledge capital of the world through enhanced R&D and innovation efforts,” said Aalok Kumar, CEO, president and chairman of NEC Corp India.
Similarly, other industry leaders, like Salesforce India chairperson and CEO Arundhati Bhattacharya, have urged for more solid measures to be introduced to protect workers from the potential impact AI could have, particularly in upskilling themselves to use AI.
“Building the right skills within the working-age population will be crucial to sustain the growth momentum and equitable wealth distribution. While there are several resources available for upskilling, standardising these through certifications and publicising them extensively, especially in tier 3, tier 4, and rural areas is critical,” said Bhattacharya.
Additionally, she highlighted the importance for regulations to be more streamlined, in order to encourage the overall growth of the sector.
“Simplifying onerous compliance requirements can go a long way in accelerating the growth of India. GCCs, for instance, generate employment and set off a multiplier effect, driving consumption and secondary employment in their ecosystem,” she said.
Overall, it seems that the government has done well by acknowledging the growth of AI over the past couple of years. However, specific and concrete measures seem to be lacking, with many industry leaders hoping for this to change with Sitharaman’s presentation.
