As in the previous meltdowns, the latest one has prompted the familiar questions:<\/p>\n
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- Why can’t India build something like this?<\/li>\n
- Are we falling behind?<\/li>\n<\/ul>\n
In my opinion, these are irrelevant questions.<\/p>\n
India can still become a $10 trillion economy without leading the world in every frontier technology. As economist Dhiraj Nayyar argued in his oped in Economic Times<\/em><\/a>, India has enormous room to grow by doing more of what it already does well and additionally by capturing manufacturing of the nature that China is gradually becoming less competitive in.<\/p>\n
The real issue worth losing sleep over is whether the Indian economy can consistently deliver double-digit growth. Whether it does it via services or by inventing the next\u00a0jingbanggizmo technology is secondary.\u00a0I made this argument in my blog post Innovate Now, Invent Later<\/em><\/a>.<\/p>\n
Then there’s another uncomfortable historical fact that often gets overlooked in all this “India must do this, India must do that” public discourse. When China’s economy was roughly India’s size about two decades ago, it was not known for cutting-edge fundamental research. Instead, it acquired technology aggressively, often by copying or stealing intellectual property from Silicon Valley.<\/p>\n
Huawei’s<\/em> rise is a classic example. Today, Huawei is larger than Cisco<\/em> in several businesses. But in the late 1990s, it allegedly got its start by copying Cisco’s router software, including source code and even bug codes. This history is documented in numerous reports, including analyses of how China accelerated its R&D capabilities through widespread IP appropriation. More at\u00a0How China Primed Its R&D Pump With IP Theft<\/em><\/a>.<\/p>\n
None of this is to justify intellectual property theft but to call out the sequence followed by many countries so far: Copy \/ Reverse engineering of existing technologies —> Manufacturing —> Commercialization —> Frontier research.<\/p>\n
India’s trajectory has been different here.<\/p>\n
![\"\"](\"https:\/\/gtm360.com\/blog\/wp-content\/uploads\/2025\/12\/TIKTOK-BAN-CHINA-APPS-CLONES-ET-18JUL2020-2.jpg\")
<\/a>When GoI banned the Chinese short video app TikTok<\/em>, the move created a once-in-a-generation opportunity for Indian entrepreneurs. Several well-funded domestic short-video applications emerged almost overnight – e.g. Mitron<\/em>, Chingari<\/em>, et al<\/em> per exhibit on the right – and enjoyed a level of protection that startups in most markets could only dream of.<\/p>\nYet none of them could compete with Instagram Reels<\/em> or YouTube Shorts<\/em>. Today, those two American apps dominate the short video space in India.<\/p>\n
That episode says something important. Despite favorable conditions, India did not produce a globally competitive consumer internet product. This may be uncomfortable to acknowledge, but perhaps fundamental invention is not India’s strongest suit.<\/p>\n
And that’s perfectly fine.<\/p>\n
India is already the world’s leading IT services outsourcing hub. Indian companies have globally valuable capabilities in software engineering, systems integration, consulting, digital transformation, enterprise services, and increasingly AI deployment. These are businesses that that generate GDP, exports, employment, and wealth. Nothing to sneeze at.<\/p>\n
Business 101 teaches us to double down on strengths rather than obsess over weaknesses. That’s what India should do.<\/p>\n
Instead of whipping ourselves up for every breakthrough coming out of Silicon Valley or China, India should focus on expanding the sectors where it already enjoys a durable competitive advantage.<\/p>\n
There is nothing unambitious about that strategy. In fact, it may be the fastest route to becoming a high-income economy.<\/p>\n
The question, therefore, is not whether India can build the next ChatGPT \/ Claude \/ DeepSeek \/ Qwen \/ Kimi.<\/p>\n
It is whether India can sustain the kind of rapid economic growth that creates the resources, talent pool, and industrial base from which future Kimis might eventually emerge.<\/p>\n
Some people view this playbook as mutually exclusive with AI research. It’s not. Nobody is saying India should ditch foundational research. India should absolutely invest in foundational AI research, support its universities, fund ambitious startups, and build domestic capabilities in strategic technologies. Just that the Average Indian (J6P) needs to realize that there’s a world of difference between participating<\/em> in frontier research and making it the primary<\/em> yardstick of national success.<\/p>\n
Another mistake many commentators make is to assume that unless India produces the next GPT, Claude, or DeepSeek, it is doomed. That is like judging Germany solely by whether it builds the next iPhone or Switzerland by whether it launches the next social media platform. Every successful economy plays to its comparative advantage while steadily moving up the value chain. (Interestingly, to give a topical example of going up the value chain, India’s latest startup darling SkyRoot<\/em> got its first cheque from Myntra<\/em>, which got its first cheque from Wipro<\/em>.)<\/p>\n
Good news is India has already kicked off foundational research, and the results are visible for all to see: IndiaAI Mission-supported startups have already created 20 foundational AI models, out of which five have been released (Source: MeitY<\/em>). See exhibit below.<\/p>\n
![\"\"](\"https:\/\/gtm360.com\/blog\/wp-content\/uploads\/2026\/07\/AI-FOUNDATIONAL-MODELS-INDIA-MEITY-fi.jpg\")
<\/a><\/p>\nIndia’s biggest opportunity over the next decade may lie not in building the world’s most capable foundation model, but in becoming the world’s preferred partner for deploying AI at scale – integrating, customizing, fine-tuning, securing, and operating AI solutions across every industry.<\/p>\n
Which also happens to be the playbook recommended by Vinod Dham, Adviser, India Semiconductor Mission<\/em>. In his op-ed entitled AIm To Become Rollout Champs<\/strong> <\/a>in Economic Times<\/em>, the man who is called the Father of Pentium processor writes:<\/p>\n
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India can become the world’s AI deployment hub by leveraging its software engineering workforce and enterprise IT experience. Enterprises will come to India to reinvent their businesses with AI integration and transformation consulting. This opportunity encompasses AI operations, cybersecurity, governance, and managed AI services.<\/div>\n<\/blockquote>\n<\/p>\n