Wiring the future with US-India AI diplomacy and digital bridges

By Manoj Chugh

The historic victory of President Trump in the US elections and the swift rollout of executive orders on the first day of his term made one thing clear: a strong commitment to the principles of “America First.” For the skeptics, the message is unmistakable—President Trump is deeply focused on nationalism and his goal of “making America great again.”

Similarly in India, Prime Minister Modi has remained resolute in his ambition to transform India into a developed nation—Viksit Bharat—by 2047. The call for self-reliance, encapsulated in the slogan “Atmanirbhar Bharat,” continues to gain momentum, particularly in the technology and digital infrastructure space.

The United States has long been a global leader in communications and digital technology. However, China’s rapid rise in Artificial Intelligence (AI) poses a significant challenge to the US, which has historically led in this domain. The global race for AI supremacy will soon determine a nation’s influence, perhaps even more than its military capabilities.

This concern is reflected in the US’s reaction to China’s AI advancements. Recognising the stakes, President Trump initiated the largest AI infrastructure project in US history just two days after taking office. The USD 500 billion initiative, known as Stargate, has the backing of Oracle, OpenAI, and Softbank. Days earlier, President Biden had imposed export restrictions on advanced AI chips to over 100 countries, including India, in a move aimed at limiting China’s access to critical technologies. This action has created a noticeable divide between the US and its allies and the rest of the world.

For India, which is striving to strengthen its communications and digital infrastructure, AI represents a crucial enabler in its vision for Viksit Bharat. However, India faces a delicate balancing act: it must forge strong strategic ties with the US while preserving its autonomy. Gaining access to AI technologies will be critical to accelerating India’s national priorities in the areas of communications and the creation of population scale digital projects that can improve the quality of life for 1.4 billion people.

Shared Strengths and Common Goals

They say democracy boasts two-way traffic. India and the US share several key commonalities that form a strong foundation for future collaboration.

Democracy and shared values: Both nations cherish democracy, with one being the wealthiest and the other the most populous. These shared values and principles foster a natural alignment and provide a solid base for deeper engagement.

Technology leadership: The striking Global Capability Centres (GCCs) that line the skylines of Indian cities underscore the strong technological partnership between the two countries. Indian talent powers US corporations—both through outsourced partnerships and the 1,200 GCCs set up by US firms. This highlights the mutual benefits of collaboration. On the other hand, India relies on the US for critical technologies in communications and digital infrastructure, including semiconductors, next-generation GPUs, and AI.

People-to-people ties: Indians are the wealthiest minority group in the US, and a significant number of Indian students continue to enrich US universities each year. With 330,000 students, India was the leading source of international students to the US last year.

Bilateral trade: The US is India’s largest trading partner, with bilateral trade reaching USD 120 billion last year. Looking ahead, the US could become an increasingly important supplier of oil to India, which imports 85% of its crude oil needs. The phrase “Drill, baby, drill” has caught the imagination worldwide, and India’s oil requirements continue to grow.

Strategic initiatives: There is strong alignment in countering China’s growing influence. India is part of the Quad, which addresses China’s assertiveness in the Indo-Pacific region, while the US participates in the USD 20 billion IMEC project that connects India to Europe through the Middle East, countering China’s Belt and Road Initiative. Collaborative projects like INDUS-X and iCET, along with efforts to diversify semiconductor supply chains and joint space technology initiatives, highlight mutual areas of interest.

Opportunities, Challenges, and Collaboration

While India and the US are natural allies, the partnership must address several complexities.

AI supremacy: China’s advancements in AI and communications technologies, including 5G and 6G, present a shared challenge. Providing India access to advanced technologies such as GPUs, cybersecurity tools, and satellite technologies would enable the US to counterbalance the growing influence of China.

Market potential: India represents a significant market for American technology, both in goods and services. As the US focuses on “Make in America” and the strong brand value of American products, US businesses stand to gain substantially in a market of 1.4 billion people. Moreover, India offers an attractive opportunity for US ICT software products, particularly in the fields of GenAI, quantum computing, and next-generation communication (6G and beyond).

Supply chain resilience: India can play a key role as a partner to the US in providing value-added sub-assemblies that marry mechanical, electronic, and software components. Semiconductors are a key area of mutual interest, with Micron’s commitment to India marking a promising start.

AI for global good: A strategic partnership in AI could yield transformative outcomes. The large-scale AI infrastructure and advanced large language models (LLMs) that the US is developing could be effectively leveraged by India’s skilled engineers to create use cases that not only benefit the country but also the Global South. Strengthening this partnership would be a major advantage for the US in its competition with China for AI supremacy.

America + India: The AI Advantage

AI powered by the collaboration between America and India represents a winning formula. A strategy that combines US AI technology with India’s investments and talent in this field offers a potent recipe for success. Tens of thousands of engineers working in the GCCs of US tech firms in India will drive initiatives like “Stargate,” while India’s engineers continue to develop models tailored to the unique needs of developing nations. This collaboration will not only accelerate America’s AI ambitions but also advance India’s development goals in communications and digital infrastructure.

The future of US-India relations in communications and digital technology is promising. However, this will require strategic flexibility from both sides. For example, the US could lift export restrictions on advanced AI chips to India and deepen collaboration with Quad nations on AI and cybersecurity. In turn, India must position itself as an indispensable partner, emphasising mutual interests and benefits through greater access to critical technologies.

One certainty remains: the dynamics of the relationship will continue to evolve, ensuring there is never a dull moment.

The author is an award-winning transformational leader and the Chairman of Manoj Chugh Advisory LLP.

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