What’s Holding India Back In The AI Race ?

ILO: GenAI will reshape 25% of jobs, urging transformation over replacement and inclusive labor policies.

India’s obsession with hard work as opposed to creativity and innovation is a major factor holding back the country from developing Large AI Language Models like DeepSeek or ChatGPT. This obsession with hard work originates from its legacy IT outsourcing business. In this industry, billable hours are crucial for delivering low-end services to global clients.

This model has undoubtedly helped companies like Infosys, TCS, or Wipro build successful businesses. They achieve this by leveraging India’s low-cost labour. This is driven purely by cost factor and not innovation. This is why we see the obsession of our corporate captains with whether one should work 70 or 90 hours. However, innovation coming from the west via technologies like AI is rudely upending this brute force model. It’s now also being challenged by our neighbour, China. And, sadly we don’t have an answer.

THE REALITY

Hard work has undermined innovation and R&D. One of India’s leading institutes IIT Madras which has several millions of dollars at its disposal today is talking about the benefits of cow urine. We often hear about innovation breakthroughs from our IITs. But, these innovations are never commercialized. Scaling from lab to industrial levels is beyond us in both traditional fields and modern technologies like AI.

The focus on hard work shows up in our R&D investment of less than 0.64% of GDP. Advanced countries have 4%-6% as their investment in R&D. We aren’t even smart in copying wisely or reverse engineering products like the Japanese did in the sixties and as the Chinese have shown recently. This is why our best brains leave our country because there’s no company here that can employ them. Ironically, many of these brains contribute to advancements in AI abroad.

The other factor is our focus on quantitative factors rather than qualitative ones. We brag about the size of the population. We focus on huge numbers in our religious events or concerts. Nonetheless, we overlook the quality of facilities. We hold large concerts with even the basic hygiene facilities. Our pathetic crowd management leads of thousands of death every year at temples, problems that could be alleviated with better technology, including AI-driven solutions.

Everything is about big numbers. We focus on being the third or fifth largest economy. But, we do not measure whether the quality of life equates with those countries we rank with, such as in terms of advancements in AI technology.

WHATS FOR INNOVATION

Our IT companies boast about employing millions of people but have little or no contribution in innovation. Of the 80,000 patents filed in India, which is a colossal jump in numbers, only 560 or less than 0.0004% are working patents as per the  annual report of the Indian Patent Organisation. Sadly, very few of these working patents pertain to AI, a crucial field for the future.

In a world that is driven by knowledge power India has hopelessly fallen out of the race. Our political leadership believes that throwing money at a problem is a solution. Almost $10-12 billion are being invested in building semiconductors. But, we lack VLSI engineering talent. We have no experience in building sophisticated chips. Above all, we are completely dependent on imported raw materials. Without advancements in AI and related technologies, it’s a daunting task.

(Dr Naresh Purohit is visiting Professor-BITS Pilani (Raj) for Hospital Healthcare  System Management Programme. The views and opinion expressed in this article are those of the author.)

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