Talent goldmine, no titans: India’s AI gap on the global map

India has the second-largest pool of tech talent in the world. Its software engineers build the code that runs banks, super apps, and health systems around the world.

But when it comes to AI startups, the country has yet to produce a truly dominant global AI-application layer player like Cursor, Glean, or Cohere.

The numbers also tell a sobering story. There are over 400 funded AI startups in India, according to data from Tracxn. Of these companies, only 5% have global clients, with the US accounting for half of their customers.

While Indian startups like Yellow.ai, Haptik, and Disprz have deals with US conglomerates like Coca-Cola, Domino’s, and Abbott, their global spread is narrow. The reality is, “international” for these startups often means India plus the US, with occasional forays into Europe or Southeast Asia.

That’s not the same as building a globally recognized AI brand. So why does a country with a deep bench of engineering talent, a thriving SaaS export industry, and a massive domestic market still struggle to make that leap?

Not enough demand at home

For most Indian AI startups, the road to going global begins and ends in the US.

There are 18 such startups with overseas clientele, according to Tracxn data and Tech in Asia’s research. Seven of them have dual bases in Bengaluru and the US to be closer to enterprise buyers. In fact, more than half of these startups have dual headquarters either in the US or Singapore.

Pawan Prabhat, co-founder of Shorthills AI, argues how this is a strategic choice instead of a weakness, as founders should “go where the action is.” A comparison shows that the AI sector in the US is worth US$174 billion, accounting for nearly 46% of the global AI market.

Prabhat also points out that China’s AI market is effectively closed to outsiders, and Europe’s regulatory caution slows down adoption. Given its sizable AI budgets and leadership in frontier model development, the US remains the top destination for Indian AI firms looking to expand.

Recognizing this opportunity, some startups that began in India are relocating their base to the US.

For example, agentic AI platform Yellow.ai started out in 2016 in Bengaluru then shifted its headquarters to California in 2021. The company maintains a presence across India, Singapore, and Indonesia.

Pixis, which provides codeless AI infrastructure for marketing, also made the shift from Bengaluru to California.

From niche to scale