AI Progress Should Be Measured By Its Impact On Country’s GDP: Rajeev Chandrasekhar

Former union minister Rajeev Chandrasekhar has said that the advancement in artificial intelligence should be measured by its impact on a country’s gross domestic product (GDP).

Chandrasekhar was speaking at Mumbai Tech Week 2025 today (February 28).

Reiterating Prime Minister Narendra Modi’s vision to expand India’s digital economy, he said that currently, the digital and innovation sectors contribute about 14% to the country’s GDP and the goal is to fuel this contribution to 1/5th (20%) by achieving a trillion-dollar innovation economy by 2027. 

Chandrasekhar also said that the largest and most impactful deployment of technology happens in governance. He further pointed to India’s Digital Public Infrastructure (DPI) as a proof to how technology can deeply influence governance and democracy.

“The India DPI experience over the last six to seven years has demonstrated how technology and its use cases can create a deep impact in people’s lives, governance, and democracy. I continue to believe that if you extrapolate the India DPI model and add an AI layer to it…..It will be the biggest use case for AI,” Chandrashekhar said on the government-led use case for AI.

He further pointed out that areas like healthcare, agriculture, and disaster prediction can reflect AI drive large-scale impact.

The former minister highlighted that the government is intensifying its investments in semiconductors and AI while also prioritising talent development by funding research institutes and deeptech initiatives.

At the same time, he also outlined that fostering innovation in AI and deeptech must go hand in hand with implementing necessary safeguards.

Unlike the European model of heavy-handed regulations, Chandrashekhar advocated for a balanced approach where innovation and guardrails coexist.

“Guardrails can’t be regulated like in Europe. We don’t have to choose between citizen rights and innovation. The Digital Personal Data Protection Act is a shining example of that,” he stated.

Referring to the rise of AI models like DeepSeek, he pointed out that traditional notions about these models are evolving. They are now more frugal and capable of operating within infrastructure constraints while still delivering optimal performance.

He noted that there was once an assumption that the US had an undisputed lead in cutting-edge AI, but this perception is shifting.

Earlier this month, the government increased allocations for key technology projects by about 84% to INR 18,000 Cr. This includes production-linked incentives for mobile phones and IT hardware, as well as semiconductor schemes and the IndiaAI Mission.