Large IT Firms Have Been Big Disappointments’: CIO Criticizes India’s Tech Giants for Ignoring R&d
India’s IT giants face sharp criticism for neglecting R&D and innovation despite generating significant profits. Mihir Vora, CIO at TRUST Mutual Fund, labeled them “big disappointments,” accusing them of being risk-averse service providers. Meanwhile, Chinese firms are making groundbreaking advancements in AI, unveiling innovative, cost-effective models far ahead of global counterparts. In contrast, India’s AI landscape is described as “largely derivative,” reliant on foreign IP, cloud services, and hardware. Vora highlighted the pharmaceutical sector’s comparatively bold approach to innovation as a contrast. Experts warn that without visionary leadership and investment in cutting-edge technologies, India risks falling behind in the global tech race.
India’s IT giants, long regarded as economic pillars, are facing criticism for their lack of innovation. Mihir Vora, Chief Investment Officer at TRUST Mutual Fund, expressed his frustration, stating, “Large IT companies have been big disappointments. While generating significant cash flow and profits, they invest only a fraction in fundamental R&D and innovation. They remain risk-averse, content to operate as service providers.”
Vora’s remarks followed observations by Nilesh Jasani, Founder of GenInnov Funds, highlighting groundbreaking advancements in AI by Chinese firms. A Chinese company recently unveiled an innovative language model that is 15-20 times cheaper than leading global models but with comparable capabilities. Days later, another Chinese firm announced a model capable of processing inputs 20-32 times larger than any current counterpart, equivalent to handling a 16,000-page PDF. In contrast, India’s generative AI sector remains “largely derivative,” according to Jasani. While Indian firms focus on fine-tuning open-source models for local applications, they lack foundational innovations like GPT-4 or Claude. As a result, India remains heavily dependent on foreign intellectual property, incurring costs for cloud services, licensing, and hardware.
Vora contrasted this with the pharmaceutical industry, noting its willingness to take bigger risks relative to profit pools, including challenging multinational patents, investing in new molecule research, and developing novel drug delivery mechanisms.
This stagnation in IT innovation poses serious challenges to India’s global competitiveness. With foreign firms offering cheaper, more advanced technologies at scale, India risks being left behind. Jasani warned that without visionary leadership and bold investments in frontier technologies, India will deepen its reliance on imported tech, limiting its ability to compete globally.
Echoing these concerns, Anand Ramachandran, a global investment professional, questioned why India, despite its vast pool of tech talent and engineers, is unable to match the strides made by China and the U.S. “The Chinese are building advanced models under constraints, while the U.S. keeps advancing from version to version—so why is India not in the game?” he asked.
Disclaimer
This summary reflects insights from industry experts and highlights concerns about India’s IT sector’s innovation strategies. It aims to inform and spark constructive discussions without generalizing the entire industry.
source : business today