Satya Nadella urges India to design 10 times cheaper LLMs

Nadella’s comments highlight India’s rising importance as a hub for AI development, with the nation well-positioned to be a key player in the global AI revolution

Microsoft CEO Satya Nadella addressed the ongoing debate about whether India should focus on developing its own foundational artificial intelligence (AI) models or build applications on top of models developed by global giants like Microsoft, OpenAI, and Meta.

Nadella presented a pragmatic view, suggesting that India’s mission could be to achieve what others have accomplished at a much lower cost. “The real barrier to building large language models (LLM) is the massive capital investment required,” he explained. “What if India could do in a billion dollars what has taken $10 billion to build?” Nadella emphasized that while significant funding is often necessary for LLM development, there is an opportunity for India to find an innovative way to achieve similar results with far less investment.

He pointed out that the rapid advancements in machine learning (ML) and AI could lead to unforeseen breakthroughs. “I don’t think the last major breakthrough in AI has happened yet. We’re just one breakthrough away from a shift in the current AI landscape, where the central architecture of large language models might be replaced,” he added. Nadella expressed confidence in India’s talent pool, suggesting that the country has the potential to drive the next big leap in AI innovation.

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Nadella was responding to a query from Abhishek Singh, the head of the India AI Mission and a senior bureaucrat in the Ministry of Electronics and Information Technology (MeitY), who sought his thoughts on the future of the Indian AI ecosystem.

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At the conference, Nadella also discussed the economic potential of AI, stating that it could accelerate India's growth significantly. “AI can drive 10-15% operating leverage for businesses annually, and within 5-6 years, that translates into a 100% transformation,” he explained. This can impact companies directly, contributing to GDP growth and further advancing India’s position in the AI space.

In a major announcement, Microsoft committed to investing $3 billion in expanding its cloud computing and AI operations in India, as well as helping nurture the Indian AI ecosystem. The company also plans to train 10 million people in AI skills by 2030, underscoring its dedication to fostering AI innovation in India.