DeepSeek-R1, a cost-effective AI model developed by a Chinese lab, has sparked a debate about the future of AI development. While posing a challenge to US tech giants, it also presents opportunities for Indian companies to leverage powerful AI without relying on Big Tech. This report explores how DeepSeek-R1 could propel India's AI capabilities and impact its tech sector.
This report is from this week's CNBC's "Inside India " newsletter which brings you timely, insightful news and market commentary on the emerging powerhouse and the big businesses behind its meteoric rise. Like what you see? You can subscribe
While my brief foray into DeepSeek-R1 served only to satisfy my curiosity, millions of other people around the world are likely to have done the same with more productive goals in mind.Among those experimenting with DeepSeek are likely to be Indian technology companies, which for the first time will be able to offer clients a powerful reasoning AI model, trained and hosted in-house, without relying on Big Tech firms.to build such a model from scratch.
The Indian government has also embarked on subsidizing access to AI chips, known as graphics processing units, to enable academics and start-ups in the country to begin developing AI models. It might not all be good news, however. Analysts at India-based broker Anand Rathi say domestic firms with "heavy exposure" to cloud computing giants likeBank of America's analysts also cautioned that a lower barrier to entry for service providers increases competition in the sector, although these risks are at "very preliminary stages" at the moment.
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