India’s Next Sputnik Moment May Not Be In AI

On October 4, 1957, the Soviet Union launched the earth’s first artificial satellite, Sputnik-1.

Sputnik’s launch is widely regarded as the shock that propelled the United States to rush its own space programme, though the first satellite launched by NASA, a few months later, exploded on the ground.

Not long after, the US had its first successful launch, but, by that time, the Soviet Union had launched two more satellites into space, including one carrying a dog.

The term Sputnik moment refers to a technological wakeup call or shock that has in the past spurred nations like the United States to fight back with resources and determination…as America did and eventually put a man on the moon in 1969.

The Sputnik moment is also being used to describe the launch of DeepSeek, the Chinese artificial intelligence (AI) software that has apparently been developed at a fraction of the cost and resources of America’s AI and ChatGPT.

“DeepSeek R1 is AI’s Sputnik moment,” tweeted venture capitalist Marc Andreessen in a post on X on Sunday.

India’s AI Dreams

Questions are now being raised on whether India should also be in this race and how it should proceed. There is also debate over whether India should participate at all, though the earlier debate was based on the accumulated investment figure of over $500 million attributed to OpenAI and not the $6 million that DeepSeek has reportedly spent.

Infosys chairman and co-founder Nandan Nilekani last month urged Indian AI companies to shift focus from developing large language models (LLMs) to crafting practical AI applications. He had said that India's AI trajectory should be less about competing in LLM development and more about building an infrastructure to gather and utilise data, driving meaningful innovation across various sectors, highlighted the publication.

ChatGPT and DeepSeek are large language models.

“Let the big players handle that. We should instead prioritise synthetic data generation, small language models, and training tailored for real-world challenges in India,” he had said.

But at $6 million, this is not a big-player game but a smart-player game. Which brings us back to the Sputnik moment.

India’s Own Sputnik Moment

First, India’s Sputnik moment actually came after Russia’s Sputnik, almost at the same time it hit the Americans.

Credit goes to Dr Vikram Sarabhai, seen as the father of India’s space programme, who noted the launch of Sputnik and convinced the government of the day of the importance of a space programme for a developing country like India.

Sarabhai hailed from a family of industrialists who supported many of his efforts including setting up the Physical Research Laboratory in Ahmedabad in 1947.

The Indian National Committee for Space Research (INCOSPAR) was set up in 1962 of which he was the chairman. The INCOSPAR later became the Indian Space Research Organisation (ISRO) which we know. The first satellite went up in November 1963.

So is this a Sputnik moment for us like some in the US are seeing it?

It may be but in a different way.

DeepSeek demonstrates the power of frugal engineering — going by the information we have now — that India has always been known for. ISRO is perhaps the oldest, best-known example of that.

Remember the stories of India launching satellites at a cheaper cost than Hollywood films made on space exploration, like the film Gravity? The stories are true.

ISRO is a great example of the coming together of the country’s best talent and setting, and aligning with a national goal which further aligns with a global race of sorts.

ISRO by the way has just achieved its 100th rocket mission.

The larger question then, should the government also jump into the AI challenge?

India’s Sputnik Moment Lies Elsewhere

The problem is that the government’s involvement works in very few areas of technology innovation today. Innovation in cutting-edge technology is best left to the private sector — for planning and execution — as it happened in China.

China’s own Sputnik moment, columnist Thomas Friedman has pointed out, happened in Donald Trump’s first term when the flow of technology and semiconductor chips from America started slowing down.

As Jim McGregor, author and business consultant who lived in China for 30 years told him. “He woke them up to the fact that they needed an all-hands-on-deck effort to take their indigenous scientific, innovative and advanced manufacturing skills to a new level.”

India’s Sputnik moment lies not so much in cutting edge technology like AI systems because we can benefit from DeepSeek too, as we do from the billions of dollars of Chinese electronics items we import.

India should focus on the tougher, sleeves rolled up challenges of making manufacturing more competitive, bottom up.

India has been steadily losing share to a host of countries in apparel exports for example. Bangladesh’s share of apparel exports to the US is 9.3% versus India’s 6%.

If you think Bangladesh is an exception, Indonesia is just behind at 5.4% and Cambodia, whose share is rising is at 4.8%. All three countries are much smaller than India.

Of course, comparing garment manufacture and DeepSeek this may sound utterly boring and bereft of glamour, but unless Indian industry becomes more competitive and faster and finds bottom-up solutions to become world leaders in some areas of manufacturing, Donald Trump’s tariff threats will be the least of our problems.