How India’s AI Factories Will Reshape the Startup Economy

India is gearing up to export a new kind of value – intelligence. Not merely through software talent or SaaS licensing, but through industrial-scale AI models, autonomous agents and digital decision systems that can optimise sectors such as healthcare, agriculture, logistics, finance and public services.

According to Deloitte’s Tech Trends 2025 – India Perspective report, India is entering what the firm describes as the AI factory era, in which AI becomes infrastructure and intelligence becomes a product category built for domestic deployment and international markets

The Architecture of an Invisible Industrial Revolution

Unlike traditional factories with visible machinery, AI factories operate quietly. Their raw materials are datasets, GPUs and domain expertise; their output is cognition. Engineers, mathematicians and linguists form the new industrial workforce.

Deloitte outlines three foundational shifts enabling this transition.
First, through the government’s IndiaAI Mission, more than ₹10,370 crore is dedicated to scaling compute and data platforms, including access to 18,000+ GPUs at globally competitive costs (~$1/hour).

Second, semiconductor collaborations with Taiwanese, Japanese and U.S. firms are establishing the hardware backbone required for accelerated model training and inference at scale.

Third, 1,800+ Global Capability Centres (GCCs) now serve as embedded R&D hubs for multinational enterprises, anchoring AI experiments in BFSI, telecom, healthcare, automotive and manufacturing.

Together, these developments create fertile ground for startups building downstream applications and services.

Startups and the Shift from Abstract AI to Applied Intelligence

India’s advantage in Artificial Intelligence (AI) is unlikely to come from building the largest models. Deloitte notes the country’s shift toward Small Language Models (SLMs) and vernacular AI tuned for real operational contexts in BFSI, healthcare and public services.

This directional shift opens constructive whitespace for founders focused on:

• logistics optimisation
• financial compliance & credit automation
• healthcare diagnostics & triage
• agri-decision support
• industrial digital twins
• agentic co-pilots for operations

Agentic AI, highlighted by Deloitte as an emerging category, is already being piloted in logistics, BFSI, education and disaster response scenarios.

These are not chat interfaces; they are operational systems that make decisions.

Talent remains a structural strength. Deloitte cites more than 650,000 AI-skilled professionals, supported by GCCs, academia and enterprise demand, as evidence of India’s production-grade AI workforce.

The startup ecosystem benefits directly from this alignment of talent and industrial demand.

2026: Where Deployment Becomes India’s Advantage

Deloitte positions 2025 as the foundation year for scaling AI factory infrastructure. But the more subtle opportunity lies in 2026, when the constraint moves downstream from building models to deploying and monetising them.

Once compute, semiconductor supply and datasets mature, the differentiator becomes distribution. Here India holds a unique advantage: public digital infrastructure such as UPI, ONDC, Account Aggregator, DigiYatra and ABDM, which offer ready-made rails for ecosystem-wide AI adoption.

In this context, India’s AI factories won’t simply produce cognition; they will enable startups to convert cognition into productivity:

• lower operational costs
• faster decision cycles
• improved yield
• better risk management

MSMEs — a segment contributing ~30% of GDP and ~45% of exports — represent a large, under-digitised adoption frontier for such applied AI solutions.

Deloitte identifies data as the final missing input, especially in healthcare, agriculture, education and SME workflows. The IndiaAI datasets platform aims to close this gap through structured data availability at scale.

If these components align, India has a credible opportunity to shift from exporting code to commercialising cognition — a strategic evolution as consequential as the rise of SaaS.

Factories once built machines.
Software once built networks.
India’s startups may soon build intelligence — and sell it.