AI Firms Getting GPU Incentives May See Government at the Table

Plan for small stakes signals shift from subsidy focus to long-term participation

- Shouvik Das

NEW DELHI: There's no free lunch for startups eyeing subsidized access to powerful graphics processing units (GPUs) under India's AI Mission. In return for the 'grant', the ministry of electronics and information technology (Meity) is considering picking up 2-4% stake in the startups as part of its GPU allocation strategy, founders of three startups shortlisted for the programme told Mint.

Four startups—Bengaluru-based Sarvam and Gnani.ai, Gurugram's Soket AI Labs, and Noida's Gan AI—have been shortlisted to use government-licensed GPUs.

The plan, which signals a shift from a purely subsidy-driven approach to one that seeks the government's long-term participation in the AI ecosystem, has sparked debate among founders and investors. While startup founders are happy with the assurance that comes with the government's skin in the game, investors raised concerns about conflict of interest.

A senior government official told Mint, requesting anonymity, that taking equity in the startups "is one of the many methods through which the government is considering rolling out the GPU access". The ministry is currently in process of vetting these methods, and a final decision on how the funding will take place may be announced in the coming months.