AI REFUSES TO BLINK

THE HARDER QUESTION REMAINS UNANSWERED: CAN INDIA TURN ADOPTION INTO INNOVATION?

- SHOBHANA SUBRAMANIAN

IF 2025 WAS SUPPOSED to be the year the AI bubble popped, nobody told the markets.

Even as investors fretted about frothy valuations and déjà vu from past tech manias, artificial intelligence stocks powered ahead. Chipmaker Nvidia crossed a historic milestone, becoming the world’s first $5-trillion company. China’s DeepSeek emerged as a credible rival, but Silicon Valley barely flinched. Instead, Big Tech doubled down—on chips, data centres and ever-larger AI ambitions.

The past year saw a frenzy of alliances between technology giants and AI specialists, many of them running into the hundreds of billions of dollars. Critics called these relationships “incestuous”; investors called them inevitable. What is clear is that the era of massive spending on Al infrastructure is not over. The combined annual capital expenditure of the world’s four largest hyperscalers is expected to average $300-$400 billion over the next couple of years. For global IT services firms, that spending wave could prove a rare growth opportunity in an otherwise cautious tech cycle.

Back home, the Al story is unfolding on a different plane. Adoption is already visible in banks, large corporates and hospitals. Over the next year, it is expected to trickle down to smaller enterprises and informal businesses. But the real explosion is happening in consumer AI. Cheap data and free subscriptions bundled by telecom operators have turned India into a testing ground for Al apps.