Nikhil Kamath: Why India Should Pivot Its AI Strategy

Speaking at the NDTV World Summit 2026, Kamath noted that the sheer volume of risk capital available to American and Chinese firms creates an insurmountable barrier for others in the race for core AI development. He argued that Indian companies have a low probability of success if they attempt to build advanced models from scratch, as they lack the massive funding required for such high-stakes experimentation.

Instead, India’s competitive edge lies in efficiency. Kamath highlighted that setting up data center infrastructure in India is 30% to 40% cheaper than in the West, bolstered by significantly lower electricity costs. By focusing on inference—running applications on existing open-source models—Indian firms can provide businesses with private, cost-effective solutions. This strategy avoids the capital-intensive "chips and models" layer while addressing the practical needs of global enterprises.

Beyond technology, Kamath proposed a shift in domestic governance, suggesting India’s 28 states adopt a competitive model similar to Chinese provinces. By empowering chief ministers to operate like corporate CEOs, states could aggressively vie for investment and growth. He also emphasized that the future of Indian entrepreneurship lies in exporting, urging local brands to target the US market rather than relying solely on domestic consumption, a challenge previously highlighted by Microsoft CEO Satya Nadella.