Indian firms at forefront of AI adoption but more funding for research critical

India has an incredible opportunity to build AI models at scale and for its own niche use, but funding for research and innovation remains a critical requirement. At the Business Today AI Summit 2025 on Wednesday, at a session titled Powering India’s AI Revolution, experts and leaders discussed how homegrown AI is powering India’s next big leap in technology and enterprise.

Addressing the session, Ganesh Gopalan, Co-founder and CEO, Gnani.ai, highlighted that Indian corporates are at the forefront of AI adoption and, going forward, there will be a lot of adoption of AI by the government as well. “India is the place where a lot of innovation is happening, especially in terms of using AI to solve problems… It's no surprise that a lot of global entities which never looked at us are looking to set up offices in India, and starting to even hire in India folks like solution experts,” he said. AI can be used to communicate with Bharat in regional languages and build scale, he noted.

Keshav Reddy – Founder, Equal AI, spoke about the AI call assistant the company is building to answer unknown phone calls and how it has gone viral on social media with 10,000 downloads and 100 million views on the launch video. “It's super exciting to build something ground up, native AI, for India, and I think that's what we're building here. It's just the beginning. India is a scale market. You just have to go large in scale,” he underlined.

Sehaj Virk, Head of Strategy and GTM, Model API, Sarvam AI, said it is very important that builders, enterprises, and the engineers within these enterprises are empowered to build applications that are robust and that can deliver a very strong experience. “The most impressive aspect for me personally has been seeing how people interact with the APIs that we put out, the cool applications they are able to build on top of it, and how they are able to push them to scale,” he said.

He noted that India remains a very cost-sensitive market and any frontier model will require huge investment and will need to get traction very quickly. AI can be made cheaper and more accessible through the APIs with the right partnerships, enabling usage at scale and also open-sourcing.

Jaspreet Bindra, Founder, AI&Beyond and Tech Whisperer Ltd, highlighted that the number one biggest funding gap in India for AI is funding research. “We do not have any fundamental research worth its name happening in AI across the country, whether from the corporate ecosystem or even from the university ecosystem,” he pointed out. He also noted that literacy of AI is very low in India and there is a need for Jan AI along with Gen AI, with a need for a concerted effort to bring AI to the masses as part of the Digital Stack.

Noting the high level of entrepreneurship and talent in India, Reddy also expressed confidence that India will see a surge of AI companies over the next few years as more capital comes back and domestic tech companies go for IPOs and turn more profitable and sustainable.

He pointed out that the tech ecosystem has a set of S-curves. “It’s highly correlated in India to the availability of capital in the US because most of the capital comes indirectly or directly through the US, and that leads to huge ecosystem drivers in early-stage venture which is risky. So you don't see mature capital coming to venture,” he said, adding that in 2021-22 there was a huge surge of capital, which drove a lot of really good companies being built, but there is a plateau in funding right now with a lot of capital going to China and the US. Companies getting built in India are generally B2B firms, or they are companies of scale which are spinning off new ideas. He highlighted that one is not seeing great innovations, which is a concern.