Now, Indian Startups Can Develop Better AI Models

In India, people are not building foundational model. Startups are trying to build use cases based on established foundational model. So, DeepSeek’s entry will not affect Indian startups in that way. But DeepSeek is a good inspiration for somebody in India to start - V Balakrishnan, Chairman, Exfinity Venture Partners, and former CFO of Infosys, tells Bizz Buzz

Bengaluru: Indian startups can come up with innovative solutions in the AI space without the funding restraint as DeepSeek has shown that breakthrough innovation is possible without huge investment. According to fund managers of multiple VC funds, domestic startups can leverage the open source models in AI space to come up with innovative solutions.

“What DeepSeek has substantiated that the company doesn’t have to be in Silicon Valley of US or in Israel to come up with breakthrough innovation. If you have the talent and ingenuity, you can come up with innovation. Startups don’t have to build everything from scratch as they can ride on the open source model. So, India has the potential of having breakthrough innovation,” Dinesh Goel, Partner at private equity fund, Siana Capital Management, told Bizz Buzz.

According to him, Indian VC and PE funds will be looking for new ideas in the AI startup space that comes up with minimal investment. He, however, said that the approach towards investing in AI startup has not changed after DeepSeek’s entry into the global scene.

Last month, Chinese startup DeepSeek unveiled its foundational model with a fraction of investment that its counterparts in the US like OpenAI, xAI, Google have done for building their foundational models. Such frugality in investment front has rekindled hopes of building such models in India where many startups are working in this space.

“In India, people are not building foundational model. Startups are trying to build use cases based on established foundational model. So, this change (DeepSeek’s entry) will not affect Indian startups in that way. But DeepSeek is a good inspiration for somebody in India to start,” V Balakrishnan, co-founder and Chairman of Exfinity Venture Partners, and former CFO of Infosys told Bizz Buzz. He also said that India is late in the game of AI innovation and it should catch up fast.

Notably, after the launch of DeepSeek’s model, some Indian AI startups have started offering its model in their own cloud servers. This is likely to dispel fears of Indian data being sent to China as the data residency will be in India.

Ola-backed Krutrim has said that it has become the first Indian AI company to deploy DeepSeek’s AI models on domestic servers, eliminating data privacy and security concerns, at lowest ever prices. It has said that it is hosting DeepSeek’s AI models on Krutrim cloud. Similarly, another Indian cloud service provider, AceCloud has said that it would offer DeepSeek AI models to businesses under which data residency will be in India.