AI will define the next 50 years: Can India move from consumer to creator?

AI is going to reshape economies, societies, even civilisation as we know it. Eventually. For now, the world is divided into three: those who are pioneering the technology, essentially two countries (US and China) and perhaps 10 companies, those who are consuming the tech, which includes much of the world that possesses decent digital capacity and good energy systems, and those who are excluded because they lack digital infrastructure and energy. India is firmly in the second category. The question is whether it will graduate to the first.

India's biggest strength is its huge population and, therefore, data. India can demand national sovereignty (over data) or use it to negotiate access. India is facing some of the negative effects of AI, such as deepfakes and potential election interference, so it must demand morality, accountability and validity.

The proposition to make AI a 'global commons' is a noble one, perhaps guided by India's big success at creating a not-for-profit public digital infrastructure. And not for the first time in its history, India is positioning itself as a leader of the 'global south'.


However, the one risk with this approach is that India destines itself to be a recipient of AI, rather than being at the cutting edge. In fact, India's approach to AI isn't different from its approach to several other recent global trends.

Social media India has been a consumer of largely US-made social media products. The only country that has developed powerful SM platforms to counter the US is China (think TikTok). At best, India has used its size and market to do some defensive manoeuvring - regulating a limited amount of content, for example.

But what these companies have got in terms of data from the Indian consumer is far more valuable. It is algorithms made elsewhere that dictate what Indians see and consume. A bulk of the profits also accrue outside India. There is little evidence of any Indian-made platforms capturing any part of the Indian market, let alone foreign markets.

Trade India has acted like a purely consuming country in matters of global trade for several decades. The emphasis is always on playing defensive, on managing imports instead of playing offence and capturing markets for exports. It is almost as if we are reconciled to being a consumer of products made elsewhere. Again, while some manufacturing has gained steam in the last decade, there is little evidence of the emergence of homegrown products capturing Indian or foreign markets.

Climate change India has also been a leader of the 'global south', demanding access to technology and finance rather than following the China way of first-class innovation and creating a state-supported market logic for climate-mitigating technologies. Unsurprisingly, the owners of the technology are unwilling to 'share', just as the rich countries are unwilling to 'finance'.

Despite India's best intentions, something like that may happen again with AI. The reality is that control over frontiers of AI will determine power and prosperity for the next 50 yrs.

A country that thinks like a consumer is unlikely to become a producer or innovator. We need to change our mindset across the board. For AI, it is important to have a human-centric vision. But it is equally important to have a strategy for machines and ownership of IP/products.

India needs a handful of energetic startups like OpenAI and Anthropic to be working at the cutting edge. It will need the PM's promise of limited regulation and financial support. In today's non-cooperative world, for a large country, it is wise to be a creator/producer along with being a voracious consumer.

The writer is chief economist, Vedanta