India’s IT sector is fighting to catch up to global leaders in the high-stakes quest for supremacy in the developing field of GenAI. Despite having one of the greatest startup ecosystems in the world, the South Asian economy has yet to make a significant effect in the fast-evolving AI sphere.
The world is going gaga over Generative AI models, with industry verticals flocking to LLMs (Large Language Models) to boost productivity by tapping into massive volumes of data both inside and outside of organizations. There have been no native Indian challengers to the supremacy of large language model titans like as OpenAI’s ChatGPT, Google Ventures-backed Anthropic, or Google’s Bard.
“While India has over 1500 AI-based startups with over $4 billion in funding, India is still losing the AI innovation battle,” according to Sanford C. Bernstein analysts
Many of India’s major startups, to their credit, are embracing machine learning to improve areas of their business operations. For example, Flipkart uses machine learning to improve customer shopping experiences, while Razorpay uses AI to combat payment fraud. Vedantu, a unicorn tech company, has integrated artificial intelligence into its live classes, making them more accessible and inexpensive.
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According to industry sources, India’s lack of AI-first businesses is due in part to a skills imbalance among the country’s workforce. Analysts fear that the arrival of generative AI may result in the displacement of many service employees. “Among its over 5 million employees, IT in India still has a high proportion of low-wage workers such as BPO or system maintenance.” While AI is not yet capable of causing disruptions, the systems are rapidly improving.” Analysts at Bernstein.
Dev Khare, a partner at Lightspeed Venture Partners India, has examined AI’s disruptive potential and cautioned that employment and procedures in areas such as market research, content creation, legal analysis, financial analysis, and numerous IT services roles could be impacted.
However, this dislocation also creates an opportunity for India. Rapid growth in agriculture, which employs more than 40% of the country’s workforce, is difficult, and similarly, automation in the manufacturing industry may be impractical due to a large and affordable labor supply.