Inside OpenAI's India Expansion Plan: Tapping World's 2nd Biggest AI Market

ChatGPT parent OpenAI is set to open its first corporate office in India later this year. The office in New Delhi will establish the artificial intelligence company's formal presence in a key growth market. OpenAI has begun hiring to expand its local team, the company said in a statement on Friday. 

Currently, OpenAI, which is backed by Microsoft, has just one employee in India - Pragya Misra--who joined the firm last year and leads public policy and partnerships in the country.

"Opening our first office and building a local team is an important first step in our commitment to make advanced AI more accessible across the country and to build AI for India, and with India," OpenAI CEO Sam Altman said in the statement.

"The level of excitement and opportunity for AI in India is incredible. India has all the ingredients to become a global AI leader-amazing tech talent, a world-class developer ecosystem, and strong government support through the IndiaAI Mission," he added.

Why OpenAI Is Entering India

India is ChatGPT's second-largest market by users, after the United States. The company this week launched a more affordable monthly plan at $4.60, targeting the nearly one billion internet users in the world's most populous nation. It also offers a basic free plan and other premium paid subscriptions.

India has the largest population of student users on ChatGPT, and weekly active users here have quadrupled in the past year, according to OpenAI's newly shared market data released on Friday. Weekly active users of ChatGPT in India increased by more than four times in just the past year.

With a bigger presence and more staff on the ground, OpenAI could ramp up partnerships with the government, businesses and developers in the country and build features and tools specifically for India - designed to make advanced AI more affordable and accessible to people throughout the entire country.

The expansion also underscores OpenAI's effort to help shape early regulations in a technology that's rapidly changing. The world's most populous country is a massive opportunity for global tech companies, but also a market that's sometimes proven difficult for them to navigate.

Challenges Ahead

OpenAI faces legal challenges in India, with news outlets and book publishers accusing the firm of using their content without permission to help train ChatGPT. The company has denied any wrongdoing.

The company faces strong competition in India from rivals like Google's Gemini and AI startup Perplexity, both of which have launched offerings that make their advanced plans free for many users in the market.

OpenAI's India Plan

The company has also reportedly committed to working with the central government in its $1.2 billion IndiaAI Mission that seeks to build large and small language models for the region.

"OpenAI's decision to establish a presence in India reflects the country's growing leadership in digital innovation and AI adoption. With strong investments in digital public infrastructure, AI talent, and enterprise-scale solutions, India is uniquely positioned to drive the next wave of AI-led transformation," said Union Minister Ashwini Vaishnaw.

"As part of the IndiaAI Mission, we are building the ecosystem for trusted and inclusive AI, and we welcome OpenAI's partnership in advancing this vision to ensure the benefits of AI reach every citizen," the minister noted.

Local businesses and institutions across India are already using OpenAI's tools to tackle critical challenges, such as AI-powered agricultural services, streamlined recruitment, and effective governance tools.

Looking ahead, OpenAI will host its first Education Summit in India this month. Later this year, OpenAI will host its first Developer Day in India, bringing together the country's vibrant community of developers, startups, and enterprises shaping the future of AI.