By Sarvagya Mishra
India, with its colossal information technology workforce, a thriving research community, and a burgeoning technology ecosystem, stands poised at the forefront of global artificial intelligence (AI) development. The surging demand for Software as a Service (SaaS) products and services infused with AI has notably catapulted this sector into the spotlight. Recognizing the transformative potential of AI in reshaping economies, the government think-tank NITI Aayog took a crucial step by unveiling the National Strategy on Artificial Intelligence in 2018.
NITI Aayog, in its forward-looking approach, advocated the creation of Centres of Excellence (CoEs) to fortify AI development and stimulate application-based research. Fast forward five years, and AI has not only made its presence felt across sectors but has secured a recurring mention in the Union Budget, the country’s most crucial financial document. In presenting the Union Budget 2023-24, Finance Minister Nirmala Sitharaman articulated a vision to ‘Make AI in India and Make AI work for India,’ signalling a commitment to harnessing AI’s potential for technological renaissance.
While the Indian government is actively promoting AI, positioning the nation as a powerhouse in AI and analytics, challenges persist on the path to the widespread adoption of AI solutions. These hurdles necessitate a strategic approach, and industry stakeholders are eagerly anticipating more robust policies and measures in the upcoming Union Budget 2024-25. The potential impact is substantial, with the sector holding the key to boosting the national growth rate by 1.3% and adding a staggering $957 billion to India’s economy by 2035. Here’s what the AI sector demands from the union budget 2024:
Diversifying AI Applications
While the previous budget focused on augmenting AI deployment in key sectors like agriculture, healthcare and sustainable cities, stakeholders in the industry urge its expansion into other areas such as telecommunications. AI-powered voice agents, for instance, have proven transformative for multiple sectors, enhancing efficiency and user experience. Incentivizing broader application spectrum could amplify AI’s impact, catalyzing overall economic growth.
Ethical Regulation Framework
AI holds the promise to revolutionize tech development, but it also carries the potential to unsettle established norms or processes. Consequently, legislation must proactively keep pace with technology to ensure that the solutions AI platforms build are ethical. The Union Budget therefore should advocate for a “state-control” strategy in AI regulation, emphasizing the government’s active involvement in AI development and deployment. This proactive approach will uphold safety, ensure responsible use, and align the progression of technology with the nation’s strategic objectives.
Budgetary Support for AI Upskilling Programs
As per an industry report, India faces a demand to upskill or reskill 1.62 crore workers in AI and automation to address the prevailing skill deficit. In addition, the country necessitates the creation of 4.7 million new jobs in the technology sector alone, aiming to enhance the proficiency of the existing IT workforce comprising 4.6 million professionals by 2027. Acknowledging the critical requirement for a skilled AI workforce, the industry calls for budgetary support to facilitate comprehensive AI-focused upskilling programs, emphasizing the necessity for a future-ready workforce.
Investment in Emerging Frontiers
Industry leaders advocate increased investments in AI, particularly in emerging frontiers like quantum computing, digital nudges for societal well-being, and Explainable AI (XAI). Strategic funding in these cutting-edge technologies can catalyze entrepreneurial ventures, fostering an environment for groundbreaking advancements in AI. This positions India at the forefront of technological innovation, contributing to global AI leadership.
Catalyzing Startup Funding for AI
India’s tech startup ecosystem faced a funding slowdown in 2023, witnessing a 72 percent drop compared to 2022. To revitalize the AI startup landscape, the budget should prioritize ease of investing and catalyze a robust funding scenario. This will further invigorate the entrepreneurial spirit, encouraging innovation and bolstering India’s position in the global AI arena.
Conclusion
Artificial Intelligence holds great promise for India, presenting an opportunity to boost productivity, streamline costs and enhance citizens’ quality of life. While the government’s dedication to AI is on the rise, challenges persist on the path to large-scale AI deployment and the establishment of a common framework. The Union Budget 2024 stands as another promising gateway for the government to chart a comprehensive course for the future of AI in India. Considering the potential for the Indian AI market to reach US$ 3,935.5 Million by 2028, a forward-thinking AI-friendly budget can usher in a revolution, propelling the nation towards enduring growth and innovation in the technology sector.
(Sarvagya Mishra, Co-founder & Director at Superbot. Views expressed are author’s own. Please consult your financial advisor before investing.)