It all started with Yogi Adityanath’s tweet on X, a social media platform, stating a Rs 25,000 crore MoU with Puch AI to build AI Parks, large scale date centre infrastructure, AI Commons and an AI University in the state. The post quickly garnered attention from people across the country, with questions being raised about the credibility of the company and its revenue.
Days after the public scrutiny, the UP government quickly cancelled the MoU and mentioned that the decision was taken following a review that flagged concerns around the company’s financial capacity to execute a project of such scale.
Officials said the MoU, which was signed on March 23, was subjected to a standard protocol review. The process revealed what the government described as a “lack of adequate net worth” and an “absence of credible financial linkages,” prompting the cancellation.
Due diligence flags financial gaps
According to an official statement, the government had sought additional details from the company as part of its due diligence process. However, Puch AI failed to furnish the required information within the stipulated timeline.
“Necessary details as per the standard operating protocol were sought from the investor, but they failed to provide them within the stipulated time. The due diligence process further revealed a lack of adequate net worth and absence of credible financial linkages required for a project of this scale,” the statement said.
The government added that the MoU has been cancelled with immediate effect and that “no rights or obligations remain.”
From ambitious AI push to rollback
The now-scrapped agreement had been positioned as a major step in Uttar Pradesh’s push to become a hub for artificial intelligence and emerging technologies. The proposed project included plans for AI parks, data centre infrastructure, an AI commons for governance use, and even an AI-focused university.
However, officials maintained that adherence to due process takes precedence over ambition, and any proposal that fails to meet financial and transparency benchmarks will not be pursued.
MoU was only a preliminary step, says CM
Amid growing questions around the deal, Chief Minister Yogi Adityanath had earlier clarified that the MoU was not a final commitment but merely an initial step. He noted that such agreements are part of an exploratory process, where proposals are evaluated through detailed due diligence before any formal approval or implementation.
Social media scrutiny and company response
Keep in mind that Puch AI, according to the LinkedIn page of the founders, was started in June 2025. Therefore, their revenue for a full financial year would not be filed until March 2026. Furthermore, the company could not be found on the Ministry of Corporate Affairs website either.
Puch AI co-founder Siddharth Bhatia stated on X that the project was structured as a public-private partnership and did not involve any taxpayer funding. He added that the investment would have been brought in through external partners and executed in phases.