Indian AI startups secured $665 million in funding during 2025. This represents a significant 50% growth, according to industry reports. Investors are targeting specialized applications in deep tech and computer vision.
Ola founder Bhavish Aggarwal is investing $230 million into Krutrim. The AI startup focuses on building language models for India. Aggarwal funds this through his family office, as reported by TechCrunch.
Krutrim aims to raise $1.15 billion by next year. The company released its models as open source recently. This move encourages collaboration across India’s AI community.
Strategic Advantage
The startup launched Krutrim-2 with 12 billion parameters. In sentiment analysis tests, it scored 0.95 compared to 0.70 for competitors. The model achieved 80% success in code generation tasks.
Aggarwal stated on social media: “We’re nowhere close to global benchmarks yet but have made good progress in one year. By open sourcing our models, we hope the entire Indian AI community collaborates to create a world-class Indian AI ecosystem.”
Krutrim developed BharatBench, an evaluation framework for Indian languages. Existing benchmarks primarily focus on English and Chinese applications. This addresses a critical gap in the market.
Market Impact in India
The company plans India’s largest supercomputer with Nvidia partnership. The deployment begins in March with expansion throughout the year. This infrastructure will support local AI development significantly.
Krutrim uses a 128,000-token context window for processing. This allows systems to handle longer texts effectively. Complex conversations become more manageable with this approach.
India seeks to establish itself against U.S. and Chinese dominance. The government recently praised DeepSeek’s progress in AI development. Local firms receive increased support for homegrown talent.
Why It Matters Now
Deeptech, generative AI, and computer vision attract top funding. Investors focus on specialized applications with high potential. Real-world applications and value creation drive investment decisions.
Krutrim’s cloud service began offering DeepSeek on Indian servers. This demonstrates the company’s commitment to local infrastructure. Indian languages receive specialized attention in AI development.
The startup achieved high scores in grammar correction (0.98). Multi-turn conversations scored 0.91 in performance metrics. These results show progress in localized AI capabilities.
What Business Leaders Should Know
The funding surge reflects collective ambition among Indian startups. Investors transition toward leading AI solutions in local markets. Collaboration and innovation determine competitive advantages.
Specialized sectors demonstrate the strongest investor interest currently. High-potential applications in computer vision show promise. Real-world value creation remains the primary investment criterion.
Krutrim-1 launched in January as India’s first large language model. The 7-billion-parameter system established the foundation for growth. Expansion plans continue throughout 2025 with Nvidia partnership.
India’s AI ecosystem gains momentum through targeted investments. Localized technology addresses unique consumer demands effectively. The focus on Indian languages creates significant market opportunities.
Startup founders should consider the increasing investor appetite. AI applications with clear business value attract funding. The emphasis on collaboration opens doors for partnerships.
