20th January 2025, New Delhi
Recent executive order by Biden- Harris Administration restricting access of AI Chips to non-key allies countries of US has come at a time when Govt. of India has floated a tender to procure 10,000 GPUs (AI Chips) under its ambitious Rs. 10,000-crore AI (Artificial Intelligence) Mission. Though India is not into list of countries (tier-III) for which access of US AI Chips have been fully restricted, but it is into tier-II category of countries for which access of US AI Chips got conditionally restricted.
Giving its analyst insights on this recent executive order of Biden-Harris administration for regulating access of AI Chips (which includes GPUs), Analyst firm 5 Jewels Research has said that though there won’t be immediate impact on the Indian AI Mission, as India being placed in tier-II category of countries for which restrictions are conditional, and allowed to procure upto 50,000 advanced GPUs, while Indian AI Mission requires procurement of only 10,000 GPUs, but other access conditions related with usages of these procured AI Chips from US may requires India to negotiate for its Sovereign AI ambitions with incoming Trump Administration.
Giving his insights Chief Analyst of 5 Jewel Research at Innogress Mr Sumant Parimal, who is a Global thought leader on Quantum & AI (Artificial Intelligence), has said “For India, recent AI chip export restrictions by US has mixed impact on Indian AI ambitions. At one end upto 50,000 GPUs exports are allowed by US for tier-II countries like India, hence existing requirements of India AI Mission to procure 10,000 GPUs through recent AI Mission tender floated by Govt. of India, where most of the bidders have proposed US based OEMs AI Chips, MeitY won’t hit any GPUs procurement cap restrictions as imposed by US Federal Govt., however at other end recent US AI Chip regulations imposes some restrictions on usages of these AI Chips, and ban its application in developing strategic AI applications in sectors like defense. Thus, even India AI mission succeed in procuring GPUs from US based chip makers like NVIDIA, AMD, Intel, but the AI systems built over those AI Chips can’t be termed as Sovereign AI as its usages, users and applications are likely to subject to US regulations”.
“With some cooling off period available before this executive order of Biden- Harris Administration on AI Chip gets enforced fully, in-coming Trump Administration has option to review the same, and this opportunity should be used by India to negotiate with the new Trump Administration to keep India into tier-I countries category, which is for key allies of US, under which no restriction exists as far as AI Chip supply is concerned. This essentially means that India should Negotiate for Sovereign AI With Trump Administration” adds Mr Sumant Parimal.
Point to be noted is that the 19 companies that submitted proposals for the government of India’s Graphics Processing Units (GPU) tender under India AI Mission, have offered a variety of GPUs from Nvidia, Advanced Micro Devices (AMD), and Intel, which essentially indicates that India AI Mission is going to be 100% dependent on US based GPU OEMs, and may requires India to comply with the rules and regulations laid out by the Federal Govt. of US for exporting AI Chips. And 5 Jewels Research Analyst believes that emergence of such regulations on supply of US based OEM’s AI Chip may delay India’s ambition to build its own Sovereign AI through on going India AI Mission.