New Delhi: Nikhil Kamath outlines AI opportunity in lower-cost services

Nikhil Kamath said India’s AI opportunity lies in making AI systems cheaper and more useful for businesses, rather than competing directly with the US and China on advanced models.

Speaking in New Delhi, the investor and entrepreneur said companies in the US and China have far more risk capital to experiment with chips, computing and advanced AI models. He said this made it difficult for Indian companies, and companies in most other countries, to compete at that level.

Kamath pointed instead to companies that can build services on open-source models, help businesses run AI systems efficiently and keep their data private. He described an inference company built on open-source models as a potential Indian strength.

He estimated that setting up a megawatt of data-centre infrastructure in India costs about 30-40% less than in the West, with lower electricity costs adding to the advantage. He said these factors could make AI infrastructure more affordable to build and run in India.

Kamath also said Indian consumer businesses should develop products for overseas markets, including the US, rather than rely mainly on domestic consumption.