Indian companies may find a foothold in artificial intelligence by offering private, locally run AI services, Zerodha co-founder Nikhil Kamath said, pointing to capital and infrastructure differences that complicate frontier-model development.
At the NDTV World Summit on Oct. 22, Kamath described a business that would run open-source models on computing infrastructure for corporate customers. That arrangement, he said, could let each customer keep its data and context private. Asked what he would pursue if he were 17 today, Kamath said, “I would focus on building something on the application or services layers.”
Kamath said Indian firms would struggle to develop frontier models because the United States, China and a few other markets have more risk capital, in his view.
A March 25, 2026, report from CareEdge Ratings offers a narrower comparison. It estimated India’s data-center construction capital expenditure was 30%-40% below levels in the U.S. and China, chiefly because land costs less. The report also put Indian electricity tariffs nearly 50% below U.S. rates, but its construction comparison does not cover all the markets in Kamath’s broader reference to the West.
The Ministry of Electronics and Information Technology said India’s total data-center capacity grew from about 375 megawatts in 2020 to around 1,500 megawatts by 2025. In a March release, it said 38,231 graphics processing units had been onboarded through 14 empanelled providers and data centers for eligible users. The ministry said they were offered at an average subsidized rate of ₹65 an hour, about one-third of the global average.
CareEdge tracks co-location capacity separately. It said that capacity doubled to 1.2 gigawatts from FY2022 through FY2025 and forecast growth to 4 gigawatts by FY2030. The expansion would require about ₹1.5 trillion in investment during FY2026-30, the report estimated. CareEdge said lower setup costs may draw hyperscalers and global cloud providers, while identifying power transmission, substations, water efficiency and connectivity as expansion needs.
The Ministry of Power estimated data-center electricity demand could reach 13.56 gigawatts by FY2031-32, according to the ministry release.
