In 2025, US artificial intelligence (AI) giants have taken the Indian market by storm, seeking to capture its large consumer base, tap its deep reservoir of tech talent and make critical inroads with policymakers.
This flurry of activity offers a fascinating case study of American AI firms’ efforts to expand their global footprint, but also raises critical questions about the globalization of AI, especially given the Indian government’s push for indigenous AI models and digital sovereignty.
To US companies staking out the future of global consumer AI, the Indian market’s appeal is undeniable. The South Asian nation has a large, young and broadly digital-native population—attributes that help explain the intensifying race to win over Indian users.
OpenAI, the global industry leader, has taken dramatic steps over the past four months. In August, the company launched a “Go” tier of ChatGPT exclusively in India, at the reduced price of 399 rupees (under US$5) per month. On November 4, in a sign of the growing competition for the Indian market, OpenAI made ChatGPT Go free for Indian users for the next 12 months.
US AI firms have also tapped the explosion in mobile phones and cellular data in India, forging novel partnerships with the country’s largest telecommunications providers to reach ready-made consumer bases.
Perplexity, which offers a popular AI-powered search engine, joined with Airtel earlier this year to offer 12 months of Perplexity Pro free to Airtel customers in India.
Similarly, on October 30, Google announced a partnership with Reliance Jio to provide 18 months of Google’s AI Pro subscription free to Jio Unlimited 5G customers.
India’s digital-first youth have emerged as a particular focus for US AI companies seeking widespread adoption. The Google-Jio collaboration, for example, was first rolled out to users ages 18 to 25.
To engage younger users, firms have also focused on educational applications of AI. In September, Perplexity CEO Aravind Srinivas established a tie up with the All India Council for Technical Education (AICTE) to give Perplexity Pro to engineering students across the nation.
For its part, OpenAI has created a Learning Accelerator in India to facilitate “AI research, training and deployment” for educators and learners alike.
Of course, the past year has also demonstrated that American AI giants view India not only as an important consumer market but as a critical source of talent and an ideal site for global workforce expansion. OpenAI’s first office in India is expected to open in New Delhi by the end of 2025.
Competitor Anthropic—the company behind popular chatbot Claude—will establish an outpost in Bengaluru in early 2026. India’s IT sector has long been a core pillar of its service-oriented export economy; these moves show that the country’s tech labor force will continue to attract foreign corporations eager to hire talent for the AI revolution.
Whether looking to capture the consumer market or tap engineering prowess, US AI companies have proactively courted the Indian government, consistently engaging policymakers at the highest level.
OpenAI’s first hire in India—Pragya Misra, who joined in 2024—is a Delhi-based government affairs professional, reflecting the firm’s desire to nimbly navigate the regulatory environment.
OpenAI CEO Sam Altman has made personal inroads with Indian Prime Minister Narendra Modi, meeting the leader twice in June 2023 and February 2025. Anthropic CEO Dario Amodei recently followed suit, meeting Modi on October 11.
US companies have likely pursued such engagements in recognition of the Indian government’s identification of AI as an increasingly strategic sector, with public regulation and investment set to significantly shape the national AI landscape.
Given this policy direction, the race by US companies to corner India’s AI sector may raise uncomfortable questions for the Indian government. After all, “digital sovereignty” has anchored Indian tech policy under Modi, driving agendas from state-led “digital public infrastructure” (DPI) to the development of custom Linux operating systems for defense agencies.
Now, as AI appears poised to reshape everything from the economy to national security, the Indian government has made strong appeals for indigenous foundational AI models.
Some of the challenges posed by US AI firms in India—such as personal privacy risks and data localization—can be addressed through thoughtful regulation.
But the arrival of companies with significant head starts in frontier research and incredible access to capital and compute raises a more fundamental question: can indigenous AI models and products truly flourish in a world of globalized AI?
If India—and other countries pursuing digital sovereignty—cannot reconcile this tension, they may soon face difficult trade-offs between promoting the development and adoption of domestic AI and adopting the most advanced international models and applications.
The Indian government’s recent push for Zoho Mail over foreign providers like Gmail is one example of this potential inward turn. Still, India’s public and private investment in AI must grow dramatically to build a competitive domestic ecosystem; without this acceleration, the pursuit of digital sovereignty will remain daunting.
Andrew Gordan is a Motwani Jadeja US-India fellow at the Pacific Forum, where he researches Indian tech diplomacy. He also serves as a junior fellow in the South Asia Program at the Stimson Center think tank in Washington, DC. He is a graduate of Harvard and a recipient of the Boren and Fulbright-Nehru scholarships.
