In a recent Wall Street Journal a rticle by Isabelle Bousquette, academics from Brown, Columbia and Cornell University complained that universities in the United States are finding it difficult to keep up with research in artificial intelligence (AI) because it is simply too expensive to do so. The development and training of large AI models require substantial computing power, often beyond the reach of individual universities, particularly because of the prohibitive costs of developing models from scratch and bringing them up to the level of computing sophistication that could be meaningful for the industry. Consider, for example, that training OpenAI’s biggest models cost “much more than” $50 million to $100 million last year.

American universities, usually known for an incessant and irreverent competition for upstaging one another are now pooling resources to ensure that they do not get left behind in the research and innovation curve in the AI age. Moreover, their concern is that they do not want to be rendered irrelevant for the industry and lose their quintessential role in providing the talent pipeline for the tech firms at the forefront of AI innovation. The state of New York, as an example, has taken the lead to collaborate with seven universities including Cornell University, Columbia University, Rensselaer Polytechnic Institute among others to set up a consortium of public-private fund called “Empire AI”.

This $400 million fund is focused on promoting responsible and cutting edge AI research in universities across the state. In the past three decades, the Indian economy has surged to a large extent on the back of its computing talent with companies like Infosys and TCS making their place in the global tech supply chains. It is no news that Indian tech talent is considered an essential element in the magic mix of large and growing tech firms. However, it is also a fact that in recent times even the best of technology schools, such as the IITs have found it hard to place their students with the industry.

Part of it is indeed due to poor market conditions. Yet, part of it is because of a mismatch in the level of skills that the top league of the industry players are demanding and what computer science institutes are able to produce. This to be clear is no deficiency on part of the schools or the students. It is simply a challenge of a lack of funding. Despite poor market conditions, globally AI startups have been defying trends and raking up billions of dollars in funding. According to data from Crunchbase, investments in artificial intelligence (AI) startups surged to $24 billion from April to June, more than doubling compared to the previous quarter. The need for a talent pool that can lead these AI startups and existing tech behemoths exists and will grow despite market fluctuations in other fields.

To capitalize on this, India would need to bring in public and private funds to keep our computer science departments well-funded and at the cutting edge of AI innovation. It would not be an exaggeration to say that this is a national priority because much of our economy does depend and will depend on the competitiveness of our tech talent. To be fair, the India AI Mission seems to do exactly that. It is a publicprivate partnership, approved by the cabinet in March 2024, with a planned US $1.25 billion investment outlay to expand India’s computing infrastructure and establish an accessible data repository. It also comes with an India AI Innovation Centre (IAIC) – an academic centre that envisions to “retain” research talent in AI.

However, the IITs and NITs seem to be left out of the picture in the grand scheme of things associated with the India AI Mission. If the interim budget of February 2024 is any indicator then the overall spend on IITs is on the decline. In the February budget the government allocated Rs 10,324 crore on IITs and Rs 212 crore on IIMs, a reduction of Rs 60 crore and Rs 119 crore respectively, compared with FY24’s revised estimates. These allocations were not only an absolute decline but they also shrank in proportion to the overall budget. The new budget for the financial year due to be presented on July 23 has an opportunity to save India’s tech talent and its long term economic backbone.

(The writer is Research Manager to Dr. Kaushik Basu, Department of Economics, Cornell University, and CEO, Insights International.)