India poised to lead in AI space, says OpenAI CEO Sam Altman

In stark contrast to previously calling India’s efforts to develop its own large-scale artificial intelligence (AI) models “totally hopeless”, Open AI Chief Sam Altman said on Wednesday that India is one of the leaders of the AI revolution. “India is an incredibly important market for AI in general, for OpenAI in particular. It’s our second-largest market. We tripled users here last year, but mostly see what people in India are building with AI at every level of the stack models...all of these applications. So, I think India should be doing everything...India should be one of the leaders of the AI revolution,” Altman said here during a fireside chat with Ashwini Vaishnaw, Minister of Electronics and Information Technology...He had said that India’s chances were “totally hopeless”. However, In his current tour of India, he clarified that his earlier statement was taken out of context, explaining that AI models are still expensive to train but are becoming more feasible, and India should take a leadership role in this space. “We’ve learned a lot about building small models...it’s not cheap, it is still expensive to train them, but it’s doable. And, I think that’s going to lead to an explosion of really great creativity...India should be a leader there too,” he said.

He said there are different ways one can look at the cost of models and it could continue to rise depending on model.  “We believe those costs will continue to rise on this exponential curve. But, also the returns to increase in intelligence are exponential in terms of both the economic and the scientific value that you can create,” he noted. Altman also said it was ‘quite amazing’ to see what India has done and embrace the technology and building the entire stack.

Altman addressed the debate over whether large language models truly require high costs, especially in light of DeepSeek’s success. He said that advancements in AI efficiency are driving both cost reductions and increased value creation. He emphasised that while the costs of AI models are decreasing, overall investment in AI will continue to rise as lower costs foster wider adoption and innovation.

“The cost for a given unit of intelligence one year later seems to decline by about 10 per cent each year. Moore’s Law predicted a doubling of transistors on a chip every 18 months, and that pattern persisted for decades. But what’s happening with cost reductions in AI models is extraordinary. Now, this means that the world’s will require less AI hardware because you bring the cost down, people are going to use it for a lot more things,” he said.

Addressing a query by Vaishnaw on cybersecurity issues, Altman said, “I think software engineering by the end of 2025 will look very different from software engineering at the beginning of 2025. It will have a huge impact — good and bad — for cyber security and we’ve got to get ahead on the good for sure.”