India’s AI opportunity could run into trillions of dollars, creating new possibilities for startups

In this article, the “AI opportunity” means the economic value India could create by applying artificial intelligence across businesses and essential services. It includes new startups, greater productivity, improved services and entirely new consumer and enterprise categories. The opportunity may be much larger than the $100 billion often discussed.

The central mechanism is access to intelligence. AI can help people and organisations perform tasks more effectively, much as the internet and smartphones expanded access to products and services. Startups could use it to address shortages in areas such as quality education, healthcare and customer services.

The opportunity is not simply about using foreign AI tools. The panellists urged Indian companies to capture more of the value created by AI. Local knowledge, strong competitive advantages and patient capital will matter as businesses grow from focused solutions into larger platforms serving India and global markets.

The article presents India’s AI impact as potentially reaching $1 trillion in additional GDP by 2035. This is a projection of the technology’s possible contribution to national economic activity, not a reported amount already achieved. It suggests that AI could become a major driver of India’s growth.

The mechanism would include higher productivity, more capable businesses and new companies serving unmet needs. AI could improve access to education, healthcare and other services. It could also create consumer and enterprise businesses that scale across India and beyond, increasing the value generated by workers and firms.

The estimate is deliberately presented as an enormous possibility rather than a certainty. Ashutosh Sharma said the outcome could be larger than $100 billion but did not fix a final number. Computing costs, sustainable advantages and patient funding will influence whether startups can serve millions of users and capture that opportunity.

AI could change businesses and consumers by making intelligence and essential services easier to access. Companies may work more productively, while consumers could receive faster, more tailored help. The article links this shift to earlier internet and smartphone revolutions, which expanded access to products and services.

Education offers a clear example. AI-powered products could help bridge India’s shortage of quality education by addressing the gap between demand and supply. Similar solutions could support healthcare and other essential services. In customer services, AI-native tools could handle communication problems that affect millions of people.

These changes could create new consumer and enterprise categories, not merely improve existing products. Indian startups can begin with one specific problem, solve it well and expand. However, they will need sustainable advantages, local understanding and enough computing capacity to support large numbers of users over time.

India has several conditions that could help AI startups grow. It has a large consumer market, a substantial talent pool, and access to venture capital and private equity funding. These resources give founders potential customers, skilled teams and financing for experimentation and expansion.

Demand is equally important. The article highlights shortages in quality education, healthcare gaps and other essential-service problems. Startups can use AI to bridge these gaps. A product that solves a widespread local problem may gain users quickly, then expand into related services or other markets.

India’s scale also creates a strong domestic testing ground. Reddy said the country is the world’s largest consuming AI country, with adoption expected to increase. Yet growth is not automatic. Computing costs remain a major constraint, and founders must build durable advantages rather than relying only on market size.

Equal AI turned a common communication problem into a focused AI business. Spam calls are widespread in India, where phone calls and messages remain important ways to communicate. Instead of starting with a broad platform, the company targeted one specific problem affecting a large consumer audience.

Its product was an AI-native call assistant. The key mechanism was matching an AI tool to an everyday need, then expanding after solving that need well. Keshav Reddy described this method simply: go deep on a problem, solve it well and expand from there. The product’s relevance helped it reach users rapidly.

Equal AI grew from around 70,000 monthly active users in January to 3.5 million in the preceding month. It had crossed one million daily active users and forecast 15 million monthly active users by March. It targeted 10 million daily active users over the following 12 months.

Understanding India’s local context can help domestic AI companies compete with international businesses. Indian consumers may have distinct languages, communication habits and everyday problems. A company that recognises those details can design a product that feels useful immediately, rather than adapting a general solution later.

The article’s Equal AI example shows this principle. Its call assistant responded to widespread spam calls in a country where calls and messages remain important communication channels. That specific knowledge helped the company address a problem at meaningful scale. Local understanding can guide both product design and the choice of problems worth solving.

This advantage is not guaranteed or permanent. Sharma said falling development costs and faster innovation make durable competitive advantages essential. Local insight can be a starting edge, but companies must continue improving, expand carefully and build platforms capable of competing with global players.

GDP is the total value of final goods and services produced within a country over a period. Productivity measures how much output workers, businesses or the economy produce from inputs such as time, labour and equipment. Higher productivity means more output can be created with the same resources, or the same output with fewer resources.

Technology can raise productivity by speeding up tasks, improving decisions and helping workers serve more people. In this article, AI could democratise access to intelligence, making people and organisations more capable. AI tools might support education, healthcare, customer services and business operations, increasing the value created by existing workers and firms.

If productivity gains spread across the economy, businesses may produce more goods and services and create new products. That larger total output can increase GDP. The article projects that AI could add $1 trillion to India’s GDP by 2035, although computing costs and other constraints may limit the gains.