The fourth industrial revolution will be based on artificial intelligence which in turn depends on ‘data’. What are the factors affecting the location of AI industry globally? Where does India stand in this context?

 Mentors Comment:

‘Data’  is the key word here. It is responsible for the location of AI industry. It is responsible for slow growth of Indian AI ecosystem. And it is the solution of making India a super power in AI.

In the intro, tell what is AI and how it will drive the next industrial revolution. Then in the first part, discuss the factors affecting the location of AI industry globally. Points will be largely based on availability of big data and support of government in funding the exosystem. Then other roles like availability of skilled personnels, ready market for the tools of AI will be discussed.

Then discuss the scene of AI in India. First discuss why India is having slow pace of grwoth in AI tech despite leading in IT field globally. Then discuss the advantages that India has in the AI field and how its turning its pace up.

Do not end the answer without giving the solutions as in what more India needs to do. Recently the draft data regulation bill was in the news. It talks of localising data in India. That is an important point and do mention it.

Model Answer:

Artificial intelligence (AI) refers to the ability of a computer or a computer-enabled robotic system to process information and produce outcomes in a manner similar to the thought process of humans in learning, decision making and solving problems. The goal of AI systems is to tackle complex problems in ways similar to human logic and reasoning. It is being termed that the next industrial revolution around the globe will be based on AI. Industrial revolution moved the centres of physical power from human and animal bodies to machines. Now AI systems are set to transform our economic, social and political organisation.

Factors for the location of AI industry:

  • Availability of data is the key driver for the location of AI industry anywhere.
  • Unlike most industrial technologies, AI does not develop in laboratories and then get applied by businesses.
  • AI develops within business processes, as data are mined from digital platforms, and turned into intelligence.
  • This intelligence is sent back to produce more data and intelligence, in infinite loops.
  • Any country’s AI therefore largely exists within its huge, domestically owned commercial digital/data systems.
  • For example, in the U.S. it is with companies like Google, Facebook, Apple etc and in China with Baidu, Alibaba and Tencent.
  • Another factor which is key for the location of the AI industry is the role of patient capital, which in this instance seems to be coming from governments.
  • Therefore nations like USA, China, Russia, Israel, with deep pockets who are ready to invest in AI industry are attracting the players to their lands.
  • Human capital, training and retaining talent has become a critical impediment to the development of AI industry globally.
  • So the places which have trained experts for AI, are a great location for establishing AI industry.

India and AI:


  • Indian startups in AI lack access to large data sets.
  • Tech giants such as Amazon, Google and IBM have larger data sets compared to Indian startups.
  • As operational costs are lower in India, at least in comparison to the US or Europe, using AI to harness efficiency gains here in India are a low-priority for enterprises
  • India is a great place for AI startups to experiment, but not a lucrative market

Advantage India:

  • Companies like Infosys, TCS, Wipro, are training their people on some of these new technologies.
  • There’s a growing base of AI research that’s happening at places like IIT Madras, and IISc
  • There are institutes that have the knowledge and talent pool, and we can find a lot of good people in a very quick time, compared to the US or any other place.
  • More and more startups are embedding AI in their technology stack and starting to supply AI for solving issues typical for India.
  • We have probably the second largest number of IT professionals in the world, and we’re good at re-training these people, we’re going to catch up soon

What needs to be done by India:

  • Some of these big investments have to involve the Indian government at times.
  • India needs to think a lot about data privacy and open data platforms.
  • Availability of data sets that could be used to train AI engines is a pain point that the government could alleviate through laws on data privacy and data accessibility.
  • In this regard, the recommendations of Srikrishna Committee on Data Protection is a right step which asks companies operating in India to store data locally.
  • Indian policymakers should be aiming at the highest levels of new value chains that AI will create in every sector.
  • Technologies should flow freely across the globe, and we must welcome global technology companies to help India’s digital development in the field of AI.
  • Data-based sectoral platforms, like in e-commerce, urban transport, agriculture, health, education, etc., should largely be domestic.
  • India should treat its collective social/economic data as a strategic national asset, like our mineral resources.


Such policy protection alone will ensure that we have large-scale data-driven Indian companies able to develop the highest AI in every sector, by employing huge Indian data to solve Indian problems. Once enough AI proficiency and strength has been developed domestically, it should then be used to go global. This is the route in becoming an AI superpower.

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5 years ago

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Pritam Kumar
5 years ago
Reply to  CD0705

Hi CD0705
-Bring more clarity in first two introductory para….more on sync in sentences/ideas is what required in first two introductory para….
-Data collection in daily day to day business is the key in developing AI…You need to show the relation among AI, Data and technology….which is missing in your answer…
-The points under India’ Stand…are very very very general…and it certainly not describe the complete picture of India’s stand…
-You need to have more conceptual clarity regarding the topic…refer our answer…or follow any well written answer for better clarity….

Good approach…keep writing…

prafull sharma
5 years ago


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Pritam Kumar
5 years ago
Reply to  prafull sharma

Hello Prafull..
-In introduction…instead of talking about…first three industrial revolution…we can mention a bit information about AI (Its what components)…
-Your points are very good…and well arranged…but it explains only half about the position of India…we also need to mention about…the lackness of India in some or other field….like…India lacks data collection in comparison to other developing countries which is the prime raw material for this…absence of big technological industries, Use of AI in India is considered low priorities as operational cost here is low…absence of market…etc…etc…etc…
However, the rest of the points are good and well written…
Good approach…keep writing….
Marks awarded: 4.5/10

5 years ago

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Pritam Kumar
5 years ago
Reply to  Imgroot

Hello Imgroot
-Introduction is very good…
-Very well mentioned ideas in arranged form…
-Though your answer inclines in one direction that is positive only…we do need to mention the lackness of India in some or other field….like…India lacks data collection in comparison to other developing countries which is the prime raw material for this…absence of big technological industries, Use of AI in India is considered low priorities as operational cost here is low…absence of market…etc…etc…etc…
Though You have attempted in well manner…good approach…
Keep writing…
Marks awarded: 4.5/10

5 years ago

CDTEST 20378comment imagecomment image

Pritam Kumar
5 years ago
Reply to  Invincible

Hi Invincible…
-Very poor introduction…it shows you lack conceptual clarity…Kindly read the question carefully…
-You have written very very very general points…
-When your are writing answer for science and tech you must include the points/ideas/words etc. related to S & T…
-Your answer lack basic clarity…and there is no points which supports the demand of the question…
Refer our model answer or other good answer checked…

Keep writing…


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