CIOInsider India Magazine

Chinese-based artificial intelligence platform DeepSeek became the most downloaded app on the Apple Store, leaving investors baffled and causing similar tech companies’ shares to drop. With functions mirroring ChatGPT, DeepSeek’s R1 model claims to be reasoning-centric, cost-efficient, and open source, making it a perfect solution for enterprises looking to integrate AI into their operations. Its success broke the notion that the only methods to advance AI are with big budgets and more expensive CPUs. However, it also introduces a new and often-overlooked risk: the sovereignty of AI models.

The real issue is figuring out how these models were created, what biases or presumptions they contain, and how they might act if given "agency"—the capacity to make decisions on their own or interact dynamically like AI agents. Open-source models can be moved into private clouds without direct vendor dependencies, which leads to the first tech prediction on this list.

The Rise of Sovereign Clouds and Data Portability
“We’ll see more demand for sovereign clouds – localized cloud environments that keep data within specific jurisdictions to support compliance and mitigate risk,” denotes Sandeep Bhambure, Vice President and Managing Director, India & SAARC, Veeam Software.

Data residency and compliance have become crucial issues in today's cloud-driven environment because of government restrictions and growing public concern over data privacy.

Sandeep perceives that evolving regulatory requirements in India, like the Digital Personal Data Protection Act and geopolitical pressures, will force enterprises to re-think where their cloud data really ‘sits.’ Expect an increased focus on data residency, ensuring data stays within specific national or regional borders. As part of this shift, we’ll see more demand for sovereign clouds – localized cloud environments that keep data within specific jurisdictions to support compliance and mitigate risk.

“This, in turn, will highlight the need for data portability across hybrid environments,” says Sandeep.

He anticipates that enterprises might find out too late in the game that moving data between clouds isn’t easy. They’ll also need to consider ‘related’ data like backups or Large Language Model (LLM) training data, where those are being kept, and what risk is present. It's a familiar story- the cloud gives businesses more options and flexibility, but taking advantage of these securely and sustainably will require some joined-up thinking.

In this respect, AceCloud has become the first Indian sovereign cloud provider to offer DeepSeek GenAI models. It will offer DeepSeek-based technology models to companies that maintain data residency in India. The company announced that businesses will be able to fully operate their own DeepSeek instance thanks to its unique environment for DeepSeek GenAI models.

The Start of Agentic AI
Like other nations, India has also entered the age of agentic AI models, born from IT companies and startups’ efforts to advance GenAI. These AI systems are believed to lift the worries away from intricate workflow operations with little to no human intervention. Besides major efforts taken to govern AI, major companies and startups are likely to attempt to self-regulate the industry by practicing ethical AI. Likewise, global AI legislation discussions took shape last year and are expected to narrow down to the specifics this year.

AI and Semiconductor Projects to Get a Boost
With the Union Budget making it through, there will be a major boost to AI and semiconductor projects. Reducing reliance on imports for semiconductors and promoting more IP-led innovation in the design of chips and electronics systems might take the hot seat this year. Additionally, the government will most probably promote the sharpening of homegrown cloud computing and AI infrastructure expertise and skills.

Satellite Internet Services
Last year, Reliance Jio was permitted to offer satellite internet services. Other companies are believed to follow suit this year.

Edtech Sector May Undergo Major Consolidation
This year, the edtech sector is anticipated to undergo a considerable consolidation, with the acquisition of unicorns probably on the main agenda. Combined with an emphasis on sustainable business models and the market’s booming growth from the pandemic, there is limited space for the extravagant VC funding that was previously flourishing. Therefore, an interesting combo of offline and online models could be coming through, especially in the areas of skill development and test preparation.

The Arrow of Electric Vehicle Segment’s Shares Could be Pointing Up
After Ola Electric, Ather Energy, Revolt, Pure EV, and other startups continued to increase their market share last year, the nation’s traditional automakers are also joining the club amid ongoing the EV revolution. The industry will most probably pour more funds in areas like battery technology and charging infrastructure as the EV battlefield expands beyond two-wheelers.

Extended Reality’s First Steps In Retail
Extended reality (XR) technology is already revolutionizing the retail space in the nation by giving local Kirana shops a sci-fi feel. It is anticipated that XR integration would create the "phygital" retail segment by bridging the gap between online convenience and offline experience.

Quick Commerce - It’s Either More Competition or More Acquisition
Last year, quick commerce was the star of the show, but several new businesses have been observed abandoning the dark store model in favor of a retail-first strategy with delivery as an add-on. To capitalize on this trend, companies like FirstClub, The New Shop, and others are expanding their market footprint and raising funds. Also, it may not be news if some of these companies either end up competing or being acquired by giants.

Fintech Could be Preparing for a World Without UPI
The nation’s payment apps might be preparing for a world without UPI. Fintech companies are observed to have sought to diversify by providing credit, wealth management, payment aggregator, and foreign remittance services, even if UPI remains the foundation of digital payments. With an eye toward the NRI market and the Indian diaspora, which has become accustomed to UPI, startups are only going to investigate more into cross-border payment methods.