What GoI Must Do to Lead the Global AI Race

From Singapore to San Francisco, cities and countries are on a race to lead the AI wave. As per Stanford AI Report, 2022 has seen private investments of USD 91B into AI and Goldman Sachs estimates this to reach USD 160B by next year — an astonishing doubling in just three years. 

While the US is leading the race as of now with almost 60% top-tier researchers there and over USD 31B in funding, China is fast catching up.

With the UK, Israel and Canada in the top five, India is trailing at a distant seven with just over USD 3B in investments. 

Silicon Valley is definitely the citadel for this breakthrough AI tech and prominent ventures: OpenAI, Google, Meta and Anthropic together have the leading AI offerings in the globe — GPT-4, Gemini, DALL E-3, Claude 3  and Llama 2. GPT-4 leads the pack with over ten crore active users every week. USA had 1150 deals in 2023  as compared to its immediate rival China, which closed only 232 deals. China has about 11% of top-tier AI researchers.

The US government has been actively providing grants for AI research, starting with over USD 3B in 2022 which perhaps led to the leadership position. Chinese government has realised this and is committed to win this AI race. By 2027, Chinese government is expected to invest about USD 40B. In comparison, India has budgeted only USD 1.2B towards its AI Mission. 

If we want to lead this race, we need to do more than just funding. Countries that effectively harness AI will achieve transformative growth and significant competitive advantages, ranging from productivity and innovation to economic growth. Achieving a competitive edge in AI requires strategic investments and sound policies. 

The finance minister should have allocated sufficient funds for direct and indirect investment in AI education and talent development. In reality, India has to strengthen its STEM education and stop the brain drain like China has done for some time now. The Chinese are funded to go global for studies and are encouraged to return to their home country for leading innovation. Most Indians go abroad for jobs while the Chinese return home to help the country prosper.

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First, India must implement a robust STEM (Science, Technology, Engineering, and Mathematics) programme from early education through higher education. The IITs are still behind global top institutions like the MIT, Stanford and CMU in terms of pedagogy and curricula. Countries like Finland and Singapore have strong STEM curricula that emphasise critical thinking, problem-solving, and technical skills. 

We also need to specifically promote AI specialisation. A few institutions have developed such AI courses and degrees but these are in spite of the government policies. The USA, through institutions like Carnegie Mellon and Stanford, offers comprehensive AI programmes and research that produce top-tier talent.

Additionally, encourage lifelong learning and provide opportunities for current professionals to upskill in AI technologies. There is nothing wrong in looking at the successes of other countries in this race like France. Its “Grande Ecole du Numérique” initiative focuses on digital literacy and upskilling in AI-related fields. Skill India budgets may be used to cover this.

The second aspect is boosting R&D efforts in AI.  Increase public and private funding for such developments. Take China where a significant investment in AI R&D has led to rapid advancements and a surge in AI-related patents. India should also set up AI research centres in IITs including dedicated innovation hubs. Canada, one of the top-five countries in AI leadership has Vector Institute for Artificial Intelligence, which conducts cutting-edge research and collaborates with industry leaders. Collaboration between academia, industry, and government is essential to drive innovation. Germany’s Cyber Valley initiative brings together universities, research institutes, and companies to work on AI projects.

The third aspect to lead the race is in creating a supportive regulatory mechanism. This is easier said than done in India as always. But the Union government can start with an AI-friendly policy that supports AI innovation while addressing ethical and societal concerns. The European Union’s regulatory framework is a good example to balance AI advancement with privacy and ethical considerations. We should also ensure robust intellectual property rights to protect AI innovations, and this is needed for attracting private investments in startups here. This, along with a mindset of data sharing and privacy, has played a key role in attracting big investments in the USA.

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Fourth is about building an ecosystem around AI and innovation clusters.  Establish AI innovation ecosystems that bring together startups, investors, and researchers just as  how the Silicon Valley has done. Extend financial incentives planned for manufacturing sector to AI. Budget to offer grants, tax incentives, and funding opportunities for AI startups and research projects. Israel’s startup ecosystem benefits from government grants and a supportive venture capital environment – one reason why it is in the top ten. Also drive PPP models to promote AI development. The AI Singapore programme is a national initiative that brings together government agencies, universities, and industry partners.

Fifth, ensure ethical AI development.  Start with developing and enforcing ethical guidelines, despite the selfish interests of the ruling party.  Japan, another top-10 country, has “Society 5.0” framework that emphasises human-centric AI and ethical considerations in technology deployment. GoI must go beyond lip service to e ensure AI systems are transparent, explainable, and accountable. The EU AI strategy is a good example to emulate. Implementing measures to reduce bias in AI systems and promoting inclusivity might seem impossible in current India but this is a serious need for global AI leadership.

Finally, leverage AI for economic and social benefits. Use AI to improve public services like healthcare, education, and transportation. Estonia uses AI to streamline government services. India must also encourage industries to adopt AI to enhance competitiveness. We must have something like the Germany’s Industry 4.0 initiative.