Zerodha co-founder and entrepreneur Nikhil Kamath believes India has a significant opportunity to establish itself in the global artificial intelligence (AI) industry by focusing on applications, services and infrastructure rather than attempting to compete directly with the United States and China in developing advanced foundational AI models.
Speaking at the NDTV World Summit 2026 in a conversation with NDTV CEO and Editor-in-Chief Rahul Kanwal, Kamath shared his views on India’s position in the global AI race, emerging startup opportunities and the importance of building businesses around new technological developments.
When asked what he would do if he were 17 today, without money, connections or an established professional network, Kamath said he would explore opportunities created by technological changes, particularly by building products and services on top of emerging technology platforms.
He highlighted how AI and the internet have made education more accessible, allowing young people to learn almost anything independently without necessarily depending on traditional educational institutions.
“Today, if I want to learn about something, I could use AI, I could use the internet, and almost anything I want to learn about, if I so choose to, is available freely,” Kamath said.
Why India Should Focus on AI Applications
Explaining the different layers of the AI ecosystem, Kamath pointed to hardware, computing infrastructure, advanced AI models, inference technology, data providers, applications and services as key components of the industry.
He argued that competing with global technology leaders in developing frontier AI models would be challenging for Indian companies because of the enormous amount of risk capital available to businesses in countries such as the United States and China.
“I don’t see how an Indian company, or for that matter, any company outside of those two or three countries where there is that much risk capital, having a fair shot at competing in that layer,” he said.
Instead, Kamath believes Indian entrepreneurs should identify opportunities in the application and services layers, where businesses can use existing AI models to develop practical solutions for customers.
He also highlighted the potential for Indian companies to build AI inference businesses using open-source models. Such companies could provide businesses with more affordable computing capabilities while allowing them to retain control over their data and information.
According to Kamath, this could create opportunities for Indian startups to compete internationally without having to invest the enormous resources required to develop foundational AI models.
India’s Cost Advantage Could Support AI Infrastructure
Kamath also highlighted India’s relatively lower infrastructure and operating costs as a potential competitive advantage in the global AI ecosystem.
He estimated that the cost of setting up a megawatt of power capacity could be around 30-40 per cent lower in India than in Western markets.
He pointed to lower labour costs associated with building and maintaining data centres, along with comparatively affordable electricity in India, as factors that could support the country’s AI infrastructure ambitions.
These advantages could help Indian companies develop more cost-effective computing and inference services for businesses across different markets.
However, Kamath cautioned against attempting to compete across every layer of the AI ecosystem without considering the availability of sufficient investment capital.
What India Can Learn From China’s Startup Ecosystem
Beyond artificial intelligence, Kamath discussed how India could learn from China’s approach to economic development and regional competition.
He observed that Chinese municipalities and provinces often compete with one another to attract investment and promote economic growth.
Suggesting that India could adopt a similar approach, he said the country’s 28 states could compete more actively to encourage business development and attract entrepreneurs.
“Maybe the chief minister of a state could operate like the CEO of the state,” Kamath said.
He suggested that allowing states to retain more of the benefits generated through their economic initiatives could encourage greater competition and innovation.
Kamath Calls for a Stronger Culture of Entrepreneurial Risk-Taking
Kamath also emphasised the importance of creating an environment where entrepreneurs are encouraged to experiment, take risks and recover from failure.
Reflecting on his interactions with successful technology entrepreneurs in Silicon Valley, he said one important difference was that society in several innovation-driven markets does not necessarily look down upon people who attempt ambitious businesses and fail.
He argued that India needs to develop a similar mindset, both culturally and through policy measures, so that entrepreneurs can return to building businesses after unsuccessful ventures.
Referring to China’s entrepreneurial journey, he said India could examine policies that encourage failed entrepreneurs to restart their businesses rather than discouraging them from taking further risks.
For Kamath, the next phase of India’s technology and startup growth will depend not only on access to new technologies but also on the country’s ability to identify practical opportunities, encourage experimentation and build globally competitive businesses.