Piyush Goyal Emphasises India's Urgent Need for US ICT Products to Boost Technology Initiatives

India is seeking information and communication technology (ICT) products from the United States to enhance its data centres and artificial intelligence (AI) projects, according to Commerce and Industry Minister Piyush Goyal. He stated that under a temporary trade agreement, India has committed to resolving long-standing issues related to US medical devices and removing restrictive import licensing procedures for US ICT goods.

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The agreement aims to significantly boost trade in technology products, such as Graphics Processing Units (GPUs), which are essential for data centres. The collaboration will also explore whether US-developed or international standards are suitable for US exports entering the Indian market within six months of the agreement's implementation.

ICT Products and National Security

Goyal emphasised the importance of ICT products like Nvidia chips and AI equipment for India's national security. "For our national security, we will certainly need many ICT products for example Nvidia chips, AI equipment, products for data centres. We will need these important ICT products. It is a big win for India that the US has agreed to provide us all these ICT products, which are the need of the hour in our country," he told reporters.

Currently, India has an authorisation regime for importing IT hardware, including laptops and personal computers. Most of these imports originate from China. This system aims to protect India's interests against countries known for predatory pricing or supplying goods at irrational prices.

Opportunities for Domestic Industries

The minister highlighted that importing high-quality chips and innovative machinery from the US presents significant opportunities for India's domestic industries in modern sectors like data centres, AI, and quantum computing. Last year, India imported personal computers worth USD 5.33 billion, down from USD 7.37 billion in the previous year.

China has lodged a complaint with the World Trade Organisation (WTO) regarding India's tariffs on ICT products. Meanwhile, Union Minister Ashwini Vaishnaw recently met with senior Nvidia officials to discuss developing sovereign GPUs and manufacturing high-end data processing devices in India.

Government Support for AI Development

Nvidia holds over 80% of the global GPU market share, with its products being crucial for AI technology development worldwide. The Indian government is actively supporting GPU procurement and subsidising their availability for AI developers in the country. From an initial target of 10,000 GPUs, India has deployed 38,000 GPUs under the India AI Mission at a subsidised rate of Rs 65 per hour.

The government has also selected 12 startups to develop native AI engines. However, think tank GTRI noted that America seeks largely one-sided commitments from India on digital trade by advocating for removing barriers to digital commerce and adopting clear digital trade rules under the BTA.

This collaboration between India and the US is expected to strengthen technological ties while providing substantial growth opportunities in emerging sectors within India. The focus remains on ensuring that both nations benefit from increased trade and cooperation in technology-driven fields.

With inputs from PTI