'India AI budget falls short of needs'

Economic Times

4 days ago

ETtech Stephen Ezell, vice-president of Global Innovation Policy at the Information Technology and Innovation Foundation (ITIF) India will need to rethink data accessibility, and pump in more money to achieve its AI aspirations, Stephen Ezell, vice-president of Global Innovation Policy at the Information Technology and Innovation Foundation (ITIF) think- tank told ET. Washington DC-based Ezell said that while AI adoption would cause 'churn, shift and change', it also holds the potential to create 2.3 million new jobs in India by 2030 and add about $1.2–1.5 trillion to its economy.While India has overcome the historic lack of a concerted national AI strategy and underfunding, through the India AI Mission, it may be too little, he said. 'But its $1.25 billion budget remains only a fraction of the amount that really needs to be invested to achieve the kind of Indian leadership in AI that will come from training AI systems on model data,' he said, while also acknowledging India's strong talent base as the second-largest source of top-level AI talent globally.
Ezell believes India's continued restrictive data approach acts a major hindrance to its global AI competitiveness and stresses that data access is as important as human capital in building robust AI systems. 'India doesn't realise that data is an asset foundational to developing a competitive AI ecosystem, especially against China,' he said. Amid an onslaught of mass layoffs in the information technology sector that many fear is due to AI, Ezzell said AI's impact will be job-transformative and not job-destructive, provided countries adopt the right policies. 'Studies estimate artificial intelligence will impact at least 40% of jobs globally. However, the greater impact of AI will be on tasks performed by an individual, as opposed to that overall job,' Ezell insisted. Instead, AI may end up creating more jobs than now. 'Economists estimate that for every one job the internet has destroyed, it has created 1.2 jobs,' he said.Ezell's optimism stands in sharp contrast to rising layoffs in India's tech industry. 'Skill mismatch' and a lack of 'deployment feasibility' have been cited by industry leader TCS as key reasons behind for sloughing off 12,000 employees over FY26. But according to market estimates, thousands of mid-level tech workers across the sector have been let go in recent quarters, often replaced by AI. Industry body Nasscom expects AI and automation-induced job cuts at IT firms over the next several months. 'Technology is value neutral. AI is the most radically transformative tech, at least in the past century, and the economic impact is going to be profound. It should add $20 trillion to the global economy by 2030,' he said.
Shifting stance As a close witness to DC policymaking, Ezzell also drew attention to the stark difference between the previous Joe Biden presidential administration and the current Donald Trump-led White House when it comes to AI policy. The erstwhile Biden administration, he said, had taken a more conservative and cautious route that focused more on regulating hypothetical risks.'Policymakers tend to want to regulate against speculative harms, as opposed to trying to address genuine challenges,' he said. The Trump administration, on the other hand, focuses more aggressively on global AI leadership, resulting in pushing for the diffusion of AI technologies developed in the US. Ezzell credited this strategy for giving rise to the National AI Plan, which emphasises on developing a comprehensive 'AI stack' ranging from software, hardware, models, and data for global export. But for India, this shifting stance will be for nought if the US actively intends to gatekeep AI tech, and computing power. While the latest AI Policy calls for exporting the full US AI technology stack—hardware, models, software, applications, and standards—to allied nations willing to join America's AI alliance, it also stresses on denying foreign adversaries access to US compute power as a matter of both geostrategic competition and national security.
'On this, the focus is on countries that are foundationally techno-autocracies such as China, Russia, Iran and North Korea. India is not, and should not be included in this group,' Ezell said.
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