Daijiworld Media Network - New Delhi
New Delhi, Aug 6: Infosys co-founder Nandan Nilekani on Thursday said India is well positioned to lead the next phase of the artificial intelligence (AI) revolution by developing large-scale real-world applications instead of competing in the global race to build advanced chips and large language models.
Speaking at the NCAER India Policy Forum 2026, Nilekani said India has the potential to emerge as the world's "AI use-case capital" by deploying artificial intelligence at population scale across sectors such as agriculture, healthcare and education.
"The Western focus on AI is on infrastructure—larger models, more chips, more data centres. But infrastructure eventually gets commoditised. The value shifts to the application layer, and India can become the AI use-case capital of the world," he said.
Nilekani said India's success in building Digital Public Infrastructure (DPI) offers a model for AI adoption, enabling technology to benefit more than a billion people rather than remaining limited to businesses.
He stressed that India's biggest opportunity lies in making AI accessible through Indian languages and voice-based interfaces. Given the country's linguistic diversity and the widespread use of code-mixed languages in everyday communication, AI systems must be capable of understanding multilingual speech rather than relying solely on English.
"If you want AI to work for a billion people, it has to work in Indian languages, in voice, and even in the way Indians naturally mix languages," he said.
Nilekani said AI should be used to address practical challenges such as improving agricultural productivity, strengthening healthcare delivery and enhancing educational outcomes instead of focusing only on developing frontier AI models.
Highlighting the role of entrepreneurship in India's economic future, Nilekani said startups and small businesses, rather than large corporations, would be the primary drivers of employment over the next decade.
He noted that India's startup ecosystem has expanded from fewer than 10,000 startups a decade ago to nearly 150,000 today. If the sector continues to grow at around 20 per cent annually, the country could have more than one million startups by 2035.
"These companies will not only create entrepreneurs but also create jobs," he said, adding that government initiatives have played a significant role in nurturing the startup ecosystem.
Nilekani also called for faster deregulation to reduce compliance requirements for small businesses, saying India needs a significantly easier business environment to support the creation of one million entrepreneurs.
He argued that future job creation in the AI era would come from millions of small enterprises rather than a few large companies.
According to him, large organisations are more susceptible to automation because their work processes are highly structured, whereas employees in smaller firms perform multiple roles that are more difficult to automate.
"We have to rethink how jobs get created. It may not be one company employing a million people, but a million companies employing one person each," he said.
To support small enterprises, Nilekani advocated expanding access to credit through Digital Public Infrastructure initiatives such as the Account Aggregator framework, improving market access through the Open Network for Digital Commerce (ONDC), and providing AI-powered digital tools for businesses.
He also emphasised the need to modernise India's labour market by introducing portable social security benefits, including pensions, insurance and healthcare, that remain with workers regardless of employer or employment type.
In addition, he proposed portable digital credentials that would allow workers to carry verified records of their skills and work experience across jobs, gig work and entrepreneurial ventures.
Beyond artificial intelligence, Nilekani said India must maintain high economic growth to fully utilise its demographic dividend while addressing challenges such as urbanisation, climate change, healthcare, education and productivity.
"We have to grow at a rapid pace over the next few years to take advantage of the demographic dividend," he said, warning that India is also likely to be "ground zero" for climate-related risks, including floods, heatwaves and rising sea levels.