Traditionally, we have seen that big businesses tend to gravitate to markets where there is a well‑educated workforce ready to be upskilled, healthcare systems to help support this workforce, and strong transport infrastructure to support employee mobility, business connectivity, and market scaling. Today, we see that digital infrastructure is increasingly becoming an important consideration for governments and companies within ‘Big AI’. This article will explain how India is strongly positioned to benefit from Big AI expansion.[1]
The tough AI competition
Whilst the AI competition between the USA and China regularly absorbs much of the media conversation, India is quickly becoming AI’s largest testing ground for new technologies. With India aiming to attract more than $200 billion in AI investments over the next few years, India has the potential to be a leader in AI.[2] However, the AI conversation should not be overly focused on whether India can overtake the USA or China but rather whether India can forge its own AI leadership in a different way to the USA and China.
Digital infrastructure
India has the infrastructure capability to accommodate large‑scale AI investments from foreign Big AI companies: over 700 million phones, several digital payment platforms, access to low‑cost data, and an estimated 1.1 trillion hours spent on smartphones a year.[3] Because of this, we know that India produces a very large data footprint that Big Tech wants to compete for. This is because tech companies need human‑generated data to train their models on, and India offers a pool of over 1 billion people in a digitally savvy and aspirational market.
The aspirational society
Like many historical examples of countries that have undergone significant economic development, India now has a rapidly growing middle class, which suggests an increase in individuals and families with more disposable income to spend on digital applications in the future. Alongside the ‘future of digital applications’, India has a large, well‑educated workforce ready to help build the next generation of AI tools and datasets. India produces 1.5 million engineering graduates annually, many of whom will be talented, seeking employment, and enthusiastic about the future of digital growth.
Government direction
Federal and state governments play a vital role in a country’s economic and technological development, as they largely decide where public money gets invested. Whilst India has the potential to be an AI leader, there are still gaps in its AI ecosystem that need to be filled through clear government signalling of a long‑term commitment to AI expansion. The most recent example is that the Maharashtra Cabinet has approved the creation of a new independent Department of Electronics, Information Technology and Artificial Intelligence to strengthen digital governance and promote the use of emerging technologies across the state.[4]
We would like to thank Derek Obaseki, Tajinder Barring and John Campion for their contributions to this article.
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DWF is a leading legal adviser to Indian and India-focussed companies, financial institutions and high net worth individuals and families. Our India Group, consisting of 108 lawyers from 9 countries, 16 practice areas and 9 sector groups, is the largest India group of any international law firm located outside India.
Dhruv Chhatralia BEM, the Head of the DWF India Group, was named to the India Business Law Journal’s International A-List 2024 featuring the world’s top-tier international lawyers outside India, based on recommendations by general counsels and lawyers at Indian law firms, for his work on cross-border aspects of India-related matters. DWF was ranked as an International Firm to Watch by the IBLJ in 2025. DWF was also shortlisted for the award of “Legal Practice of the Year” at the 6th Annual UK-India Awards in 2024 based on the achievements of the DWF India Group. Further details about the DWF India Group can be found on the following webpage: https://dwfgroup.com/en/services/india-group.
[1] Why Big AI Is Obsessed With India
[2] India eyes $200B in data center investments as it ramps up its AI hub ambitions | The Independent
[3] Indians spent 1.1 lakh crore hours staring at smartphones to make many richer - The Economic Times
[4] Maharashtra to set up IT, AI department as Cabinet clears key reforms
