Ola founder Bhavish Aggarwal is investing $230 million in Krutrim, an AI startup he founded, as India pushes to establish itself in the artificial intelligence landscape dominated by US and Chinese companies. Aggarwal is largely financing the investment through his family office, according to a source familiar with the matter.

The funding announcement coincides with Krutrim making its AI models open source and unveiling plans to build what it claims will be India's largest supercomputer in partnership with Nvidia. This move is seen as a significant step towards creating a world-class Indian AI ecosystem, with Aggarwal stating that he hopes the entire Indian AI community will collaborate to achieve this goal.

Krutrim has made significant progress in developing AI models optimized for Indian languages. The lab has released Krutrim-2, a 12-billion parameter language model that has shown strong performance in processing Indian languages. In sentiment analysis tests, Krutrim-2 scored 0.95 compared to 0.70 for competing models, while achieving an 80% success rate in code generation tasks. The lab has also open-sourced several specialized models, including systems for processing images, speech translation, and text search, all optimized for Indian languages.

The initiative comes as India seeks to establish itself in an artificial intelligence landscape dominated by US and Chinese companies. The recent release of DeepSeek's R1 "reasoning" model, built on a purportedly modest budget, has sent shock waves through the tech industry. India last week praised DeepSeek's progress and said the country will host the Chinese AI lab's large language models on domestic servers. Krutrim's cloud arm began offering DeepSeek on Indian servers last week.

Krutrim has developed its own evaluation framework, BharatBench, to assess AI models' proficiency in Indian languages, addressing a gap in existing benchmarks that primarily focus on English and Chinese. The lab's technical approach includes using a 128,000-token context window, allowing its systems to handle longer texts and more complex conversations. Performance metrics published by the startup showed Krutrim-2 achieving high scores in grammar correction (0.98) and multi-turn conversations (0.91).

The investment follows January's launch of Krutrim-1, a 7-billion parameter system that served as India's first large language model. The supercomputer deployment with Nvidia is scheduled to go live in March, with expansion planned throughout the year. Aggarwal aims to attract an investment of $1.15 billion by next year, with plans to raise the remainder of the capital from outside investors.

The move is seen as a significant step towards establishing India as a major player in the AI landscape. With the country hosting DeepSeek's large language models on domestic servers and Krutrim's plans to build India's largest supercomputer, India is poised to make significant strides in the AI space. Aggarwal's investment in Krutrim is a testament to his commitment to creating a world-class Indian AI ecosystem, and his vision for India to become a major player in the global AI landscape.

As India continues to push for a larger share of the global AI market, initiatives like Krutrim's open-sourcing of AI models and development of BharatBench will play a crucial role in establishing the country as a hub for AI innovation. With Aggarwal's investment and Krutrim's technical advancements, India is well on its way to becoming a significant player in the AI landscape.