Why Indian startups are lagging in building AI

By Vivek Chadha, Founder, AccelerateX Ventures

India’s startup ecosystem has seen exponential growth in the past decade, producing thousands of ventures across fintech, edtech, agritech, and more. Yet, when it comes to AI adoption, most of these companies remain behind their global peers, not in usage, but in building. AI tools are being applied, but not created. This imbalance exposes a deeper issue in how Indian startups approach technological evolution.

Consumers, Not Creators of AI

The prime problem is that Indian startups act largely as consumers of AI rather than creators. Tools like OpenAI’s GPT models and Meta’s open-source architectures are widely deployed in Indian applications, but the foundational models, where the real value lies, are still being developed elsewhere. A quick example is Sarvam LLM, India’s homegrown language model, which showcases potential in foundational AI work. Although initiatives like Sarvam LLM are ...