INDIA IN THE AL AGE

The rapid rise of AI offers India a narrow window. In the next two to three years, it must not only build AI talent, but also retain and empower it to drive meaningful progress

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This year, a small Chinese firm named DeepSeek stunned the global artificial intelligence (Al) ecosystem. Its models, including DeepSeek-V2, broke into top tiers of benchmark rankings like MMLU and HumanEval. However, it wasn’t just their performance that grabbed attention. DeepSeek did something more disruptive: it reduced the cost of inference dramatically.

Its engineering ingenuity enabled powerful performance without the burden of heavy compute cost - a challenge that has plagued Western Al firms like OpenAl and Meta, who continue to invest billions in GPUs, cloud infrastructure, and data storage. The implications are profound: a new axis of competition in Al, one focused not just on scale or intelligence, but on affordability and access.

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In some ways, this mirrors India's IT revolution. The country rose to global prominence not by leading in core innovation, but by offering high-quality services at lower costs. English fluency, engineering skills, and time-zone advantages made India the back office of the digital world. But the Al era is rewriting that playbook.

Large Language Models (LLMs) and generative systems are flattening the advantage once held by linguistic skills or even programming expertise. Al can now code, translate, draft legal opinions, and debug complex software systems.

As generative Al becomes more cost-efficient, even India’s low-cost workforce faces the risk of redundancy. And as other emerging nations start to offer high-performance models at cheaper prices, India’s unique value proposition is under serious strain.

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