Indian AI Vacuum Calls for New Technorati

China's DeepSeek Upending American AI Investment Thesis is Cold War 2.0 in Full Swing

India's ageing technorati, which built the IT services empires in the previous era, is failing in the age of artificial intelligence (AI). With China's DeepSeek shaking up the AI arms race, it is imperative for India's political leadership to seek new inspiration, given its geopolitical implications.

DeepSeek's reasoning model has evoked raving responses from users and storied Silicon Valley tech investors like Marc Andreessen, who hailed it one of the most impressive breakthroughs and a profound gift to the world of AI.

The claim that DeepSeek R1 was built on just over 2000 Nvidia chips and spent a mere $5.6 million stunned AI researchers and investors.

China's showing up with an efficient AI model trained on such low computing prompts investors to question the elevated expenses committed to AI Armageddon.

It raised serious questions about whether the rest of the world, especially the U.S., was overspending or inefficient. Here is a little-known Chinese startup debunking the trillion-dollar investing thesis of American hyperscalers. Andreessen called it the Sputnik moment in the AI race.

China's bets on critical minerals and technologies of the future under Chairman Xi Jinping are beginning to unnerve the world. A better understanding of DeepSeek's impact saw a global rout in tech stocks, wiping off nearly $1 trillion in market value.

The communist economy's stranglehold over the supply chain of clean energy and electric mobility helped it take an unassailable lead in decarbonisation globally.

The new arms race between the U.S. and China—also involving continental Europe to some extent—is about who first reaches artificial general intelligence or superintelligence.

Computers move ahead of human intelligence in this state in many walks of life. It will be a pivotal moment in the slugfest to maintain or shake up global political and corporate power.

This probably mirrors the nuclear and space wars between the U.S. and the former Soviet Union (Russia) in the original Cold War. Who would the leading nations be if there were an AI Club akin to the nuclear club on the geopolitical chessboard?

For India, it is time to think hard about where it stands on the most consequential technology shaping global commerce, consumption, and security. The world's most populous nation, the fastest-growing major economy, and home to the largest pool of engineering talent are wayside observers in the build-up of the AI industrial complex.

A cohort of Indians is shining in applied AI innovation, which attempts to adapt the technology to the country's low-resource languages and key industries. However, a fragmented ecosystem, a paucity of computing resources at scale, and a lack of funding have slowed down foundational AI work in India.

India's leading technocrats argued against spending precious capital on foundational AI. The country's playbook on semiconductor supply chains, data centres, cloud computing, and elevated power generation capacities isn't cohesive and has yet to take off. Mukesh Ambani's Reliance Industries is charting ambitious data centres and cloud plans while Tata is readying semiconductor plans.

However, the technology billionaires—who sought to dominate the policy arguments—are missing action in presenting any hyperscaler plan for Indian AI.

Time and careers outrun all mortals, including geniuses with humble beginnings. It is time for India to look at new heroes and build new leverage in the age of Muskism and Trumpian politics.

The AI Club is on the way.