- Published on August 20, 2025
- In AI Startups
Small Successes Mask Fundamental Gaps in India’s AI Ecosystem
While applications flourish, true innovation remains stunted, risking India’s potential to become a leader in AI.
Image by Nalini Nirad
- By Smruthi Nadig
The growth in India’s AI startup ecosystem, powered by waves of capital and a global-first mindset, often makes the headlines. However, these success stories mask persistent deficiencies in infrastructure, R&D investment, and innovation capacity.
This systemic gap keeps the AI ecosystem heavily reliant on foreign foundational models, as it lacks sufficient deep research capacity, and struggles to transition from derivative applications to developing core technology.
Sanchit Vir Gogia, CEO and chief analyst of Greyhound Research, noted that familiar challenges hinder India’s goal to develop GPT-scale models. He said that 58% of decision-makers see the lack of affordable GPU clusters as the main obstacle. In comparison, 52% cite the absence of properly cleared Indic
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Smruthi Nadig
Smruthi brings over two years of experience in reporting on the global energy industry. They hold a Master's Degree from the University of Leeds in International Journalism and a Bachelor's Degree from Christ University in Media Studies, Economics and Political Science.
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