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Today, we break down the biggest takeaways from a blockbuster week that could define India’s place in the global AI race.
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Macro
The trade gap in January widened to $34.7 billion (₹3.1 trillion) due to imports rising 19 percent y-o-y. The trade gap preceded the new trade deal which should help boost exports which stayed flat since last year.
India reported green hydrogen costs at just $3.08 (₹279) per kilogram, the lowest ever price.The gas is used for hard-to-abate heavy industries like steel and cement. Proliferation of the energy source grew due to a government push and low renewable energy costs. Local refineries in Delhi will be asked to create 200,000 tons of annual green hydrogen consumption.
Equities
Coal India reports profit dropped for a 3rd consecutive quarter from lackluster power demand. Net income declined 16 percent y-o-y to $790 million (₹71.6 billion) with revenue declining 5 percent. Coal is slowly being phased out of the power mix while input costs rose due to intensifying competition.
The National Highway Authority is going to IPO its infra investment trust to raise $629 million (₹57 billion).This will provide funding to the SPV of the project; it seeks to finance large-scale projects that stall out from lack of cash.
Alts
Expect securities firms to rethink funding with shadow banks after the RBI limited margin trading. While shadow banks are a non-complicated source, others could include non-convertible debentures, non-bank finance companies, and commercial papers. Stockbrokers like Angel One commonly borrow $400 million (₹36.3 billion) with over 50 percent coming from banks.
Anthropic reports that Indian companies are using Claude directly now. Air India and Cognizant have inputted the software into their operations and the firm is capitalizing on Indian growth by opening a new Bangalore office.
Anthropic's Amodei and OpenAI's Altman continued their rivalry at the AI Summit.The two companies are the most valuable in the AI space with OpenAi at $500 billion (₹45.4 trillion) and Anthropic at $380 billion (₹34.5 trillion). They both announced new investments in India at the same conference and both CEOs refused to clasp hands during a photoshoot.
Policy
The government reiterated that it had no hand in the US murder plot. A man was arrested, accused of trying to kill a Modi critic in 2023 on American soil. An Indian investigation in 2024 found that rogue operatives likely commanded the assassin, and the government is waiting for new investigation results before moving forward.
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Is AI Dominance in India’s Future?
The past week in New Delhi revealed a lot, both about India’s place in the economy of the future and how AI continues to evolve. The country’s flagship artificial intelligence summit laid bare both the immense productivity promise of the technology and the destabilizing capital and labor shocks it may unleash across a fast-growing economy still defined by youth underemployment and uneven income growth.
The AI transition resembles a combination of globalization being a double-edged sword, the valuation bubbles of the GFC, and increased disinformation particularly on social media. Even as enterprise productivity rises, shareholders will gain more than employees and the World Bank predicts that the globe will be short 800 million jobs in the 2030s. Of course, valuations right now are stretched from the hyperscaler-tide using leverage without explaining monetization.
Some other important pieces of news included President Macron of France believing that each country has to have a sovereign AI to compete with global LLMs like DeepSeek and Gemini. While startups like Sarvam and BharatGen released a series of India-made models this week, none have been tested in mass use.
The next big announcement was Tech Minister Vaishnaw expecting more than $200 billion (₹18.1 trillion) in AI-linked investments to flow in over the next 2 years. Keep in mind, more than that amount has been announced but he expects that to all be realized by 2028. Google announced new fiber optic routes on top of its existing $15 billion (₹1.4 trillion) investment; local conglomerates Adani and Reliance announced $100 billion (₹9.1 trillion) and $110 billion (₹10 trillion) investment plans as well.
At the end of the day, India’s AI power depends on policy. Every company is interested in AI and announcing partnerships with India for the sake of growth. Real compute dominance will be decided by politicians fixing energy pricing structures making data centers uneconomical. Or if PLIs get simplified enough for foreign firms to actually earn subsidies and if India can keep the next generation of scientists at home or if they emigrate. This boring, state-level reform will be the ultimate hurdle, not a star-studded panel.
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Written by Yash Tibrewal. Edited by Shreyas Sinha.
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