India’s startup ecosystem is moving into a new phase where long term growth will depend on access to affordable and locally controlled computing infrastructure, especially as artificial intelligence becomes central to new business models, according to a technology entrepreneur.
Narendra Sen, founder and chief executive officer of data centre and cloud services firms RackBank and NeevCloud, said startups are now shifting from early experimentation to building products that can scale in a stable way and compete on a global level.
“India’s startup ecosystem is pivoting from a phase of rapid experimentation to one of strategic scaling and sovereignty,” Sen said, adding that simple access to cloud services is no longer enough as the use of artificial intelligence increases.
Artificial intelligence is now a key focus for startups across industries. However, high computing costs and reliance on overseas infrastructure continue to limit many young companies. Sen said founders now need advanced systems that are powerful, affordable, and available within the country.
He also pointed out that most advanced computing facilities are concentrated in major cities. This, he said, could slow down innovation in other regions, especially as more startups are emerging from Tier 2 and Tier 3 cities.
“Building robust, GPU dense infrastructure in Tier 2 cities isn’t just about cost efficiency,” Sen said. “It‘s about enabling founders to build, train, and deploy locally while competing globally.”
Industry leaders and policymakers have stressed the need to spread digital infrastructure more evenly across the country. Lower data delay and closer access to computing resources are becoming critical for artificial intelligence based applications.
Sen warned that without wider access to such infrastructure, startups may be limited by computing costs instead of the strength of their ideas. “The next unicorn shouldn’t be limited by the cost of compute or data latency,” he said.
He also linked this shift to the wider debate on digital sovereignty and dependence on foreign cloud providers. “The future belongs to those who control their compute,” Sen said.
For startups, this means long term success may depend not only on funding and talent, but also on access to reliable and powerful local infrastructure.
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