As capital pours into India’s artificial intelligence and deeptech startups, the country’s chances of producing globally significant AI companies are improving—even if the race to build large language models is dominated by the US and China, according to Subrata Mitra, founding partner of venture capital firm Accel’s India arm.
“I wouldn’t put a country winner on the AI problem,” said Mitra told Mint. “Winning is company-specific. It is very specific problem statements that people are trying to solve for, and if they find the right differentiation there and scale those differences, the market is large, opportunities are large, and things will move fast.”
His comment comes at a time when the US has restricted the use of Anthropic’s latest model, Fable 5. The move has since sparked debate in India around the need for the country to build its own sovereign capabilities in high-importance sectors like AI.
While companies in the US, like OpenAI and Anthropic, and in China, like DeepSeek, Z.ai, and Moonshot AI, have raised hundreds of billions of dollars to be at the cutting edge, the Indian ecosystem has just begun to raise large rounds for artificial intelligence.
Uniphore raised $250 million in its last funding round in October 2025 at a valuation of $2.25 billion. Foundational model and enterprise AI company Sarvam recently raised $234 million at a $1.5 billion valuation in their first tranche of an overall $300 million round fromand Bessemer Venture Partners. Neysa, an AI acceleration cloud provider, raised $600 million from the likes of Blackstone, Teachers’ Venture Growth, TVS Capital, 360 ONE Assets and Nexus Venture Partners.
Mitra said while some of the larger players have built and foundation models, they’re only slightly differentiated from each other and are at a comparable level of performance.
“Whether you do infra or just apps, you have to find a space where you have some moat, he said. “Data is no longer a moat. So you’ve to either build something where it’s super personalised for the userbase or you figure out a twist in the product that others haven’t and build momentum quickly enough.”
Notably, Accel is invested in Anthropic, which filed for an initial public offering with the US market regulator on 1 June, making it the first foundation model AI company to go public.
Deeptech’s acceleration in India
Over the last 24 months, deeptech has become a sector where an increasing amount of venture investors have begun to allocate money into.
While funding peaked in 2024 at $1.6 billion, so far this year the sector has hit $1.23 billion, according to Tracxn, compared to $1.5 billion raised over the entirety of 2025.
“We feel like India is at a point where, from the defence tech side or sophisticated engineering products coming out of the country, we are probably going to see them reach scale very soon,” said Mitra.
Accel is deploying capital across AI, consumer, fintech and manufacturing from its $650 million eighth India fund launched in January 2025. The fund is deploying 10-15% of the corpus from the current fund into manufacturing. “It’s not a lot, but it is significant. Historically, we don’t like to allocate more than 20% to one area,” he said.
The Silicon Valley firm expanded its presence in India in 2008 when it merged local seed fund Erasmic Ventures into its operations. As a result, Erasmic’s leadership team, consisting of Prashant Prakakash, Mahendran Balachandran and Mitra founded ‘s India arm.
Over the last two decades, the firm has raised nearly $3 billion across its eight funds to deploy in India.
Among defence and deeptech, the firm has so far invested in drone manufacturer Unmannd, specialty chemicals company Scimplify, electric vertical take off and landing startup Sarla Aviation, micro gas turbine manufacturer for power generation and aviation Nabhdrishti Aerospace.
Accel has also expanded its deal flow and exposure to deeptech through Atoms, a pre-seed scaling program run alongside Dutch tech investor .
The firm is adding specialized team for deeptech and AI in India. “Now we find we need more AI and manufacturing expertise on our team. The kind of spice levels and cooking you want to do keeps changing, therefore you need to specialise those recipes as well,” said Mitra, who is launching his book, Down But Not Out: Gritty Comebacks of India’s Diehard Founders.