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India in watch mode for DeepSeek ripple effect
Business Standard|January 29, 2025
Some in the industry are referring to DeepSeek's artificial intelligence (AI) initiative as the "Sputnik Moment" while US President Donald Trump has called it a "wake-up call" for the American tech giants.
- SHIVANI SHINDE & AJINKYA KAWALE
India in watch mode for DeepSeek ripple effect

In India, however, the mood is one of wait and watch after the Chinese startup stunned the world with its AI model built at a fraction of the cost compared to industry leaders such as OpenAI.

Against the global backdrop of shock and awe, the Indian tech industry and startup ecosystem have been subdued in their reaction. Industry experts and investors believe that while DeepSeek's achievement democratises AI with its open-source model, these are early days to gauge its impact on the enterprise IT ecosystem. Startups, while realising the advantage that they can draw from the foundational model of the Chinese app, are also watching the developments.

Analysts are making a point. "While US tech giants like Meta & Microsoft scramble to defend their positions, ripple effects are being felt in Indian IT," said a report by Anand Rathi on The GenAI Wave: Indian IT's Next Frontier. "DeepSeek's democratisation of AI will expand the addressable market for Indian IT companies," it pointed out.

DeepSeek's open-source model challenges US tech giants like Meta, which is ramping up AI capex to $65 billion annually. Indian IT firms play a key role in the AI value chain, handling data management, migration, and fine-tuning language models like LLMs and SLMs.

This story is from the January 29, 2025 edition of Business Standard.

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This story is from the January 29, 2025 edition of Business Standard.

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