Falling behind in the AI race

What we know

By the Stanford AI Index 2025, India ranked 12th for private AI investment in 2024. Its private investment from 2013 to 2024 came to about $11 billion, against $471 billion in the US and $119 billion in China. India's pool of AI talent is one of the fastest-growing, but the same report flags weak retention, few patents and little investment.

The Economic Survey 2023-24 put India's research spending at 0.64% of GDP, against 2.41% in China and 3.47% in the US, and noted it has stayed between 0.6% and 0.7% for two decades.

The IndiaAI Mission, approved in March 2024 with ₹10,372 crore (about $1.25 billion) over five years, has onboarded more than 38,000 GPUs for startups and researchers at subsidised rates of about ₹65 an hour. It picked 12 teams, including Sarvam AI and the IIT Bombay-led BharatGen, to build Indian foundation models.

Open questions

1. How much do Indian universities spend on AI research, and what does an AI PhD student earn here compared with abroad?
2. Why does private industry fund so little of India's research, and what would change that?
3. How many of the most-cited AI researchers of Indian origin work in India, and what would bring others back?
4. What Indian-language text, speech and government data is open for training models, and what stays locked away?
5. What does it cost to train a model that competes with the best, and is the mission's budget enough?
6. Where would India get advanced chips if export controls tightened?

Sources

• Business Today: India's AI paradox (Stanford AI Index 2025)
• Tele.net: India tops AI hiring but trails in retention, patents and investment
• Storyboard18: R&D at 0.64% of GDP; IndiaAI onboards 38,000 GPUs
• The Week: Economic Survey on R&D spending