Speaking at the NCAER India Policy Forum 2026, Infosys co-founder Nandan Nilekani articulated a clear vision for India's role in the global artificial intelligence landscape. Nilekani asserted that India is uniquely positioned to become the world's "AI use-case capital" by prioritizing the development of large-scale, practical AI applications, rather than solely competing in the high-stakes race for advanced semiconductor chips and frontier AI models.
India's AI Advantage: Applications, Not Just Infrastructure
Nilekani highlighted a fundamental difference in strategic focus. While Western nations heavily invest in AI infrastructure—including larger models, advanced chips, and data centers—he argued that the real value will eventually shift to the application layer. "The Western focus on AI is on infrastructure... 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 stated.
He emphasized that India's greatest strength lies in its ability to create AI solutions tailored for its diverse population. For AI to truly impact over a billion people, it must comprehend and interact in India's multilingual and voice-first communication patterns, even accommodating natural language mixing.
Digital Public Infrastructure as a Foundation
India's robust Digital Public Infrastructure (DPI), encompassing platforms like Aadhaar and UPI, provides a formidable base for deploying AI across critical sectors such as agriculture, healthcare, and education. Nilekani urged a focus on leveraging these existing digital rails to build practical applications that enhance productivity and public services, rather than an exclusive pursuit of cutting-edge AI model development.
Startups to Drive AI Job Creation
Nilekani identified entrepreneurship as the primary engine for job creation in the evolving AI era. He pointed to the remarkable growth of India's startup ecosystem, which has expanded from fewer than 10,000 a decade ago to approximately 1.5 lakh today. He projected that this number could exceed one million by 2035 if it maintains an annual growth rate of around 20%.
"These companies will not only create entrepreneurs but also create jobs," Nilekani affirmed. He called on policymakers to streamline regulations and alleviate compliance burdens to foster a more conducive environment for entrepreneurial growth.
Rethinking Employment in an Automated Future
Addressing concerns about AI-driven automation, Nilekani suggested that the future of employment may not reside primarily with large corporations. He cautioned that structured enterprises with repetitive tasks are more susceptible to automation. Instead, he envisioned a future where millions of small businesses and startups, empowered by AI-powered tools, digital credit, and improved market access, become the dominant job creators over the next decade.
"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 mused.
Beyond AI, Nilekani stressed the importance of portable social security benefits and digital credentials to facilitate seamless transitions for workers between salaried roles, gig work, and entrepreneurship. He concluded by underscoring the necessity for India to sustain rapid economic growth to fully harness its demographic dividend while simultaneously tackling long-term challenges like climate change, healthcare, education, and urbanization.