Start-ups, MSMEs to Gain From Relaxed Procurement Criteria For 10,000 GPUs Under Boost AI Innovation

New Delhi, Oct 9 (KNN) In a decisive move to bolster the artificial intelligence (AI) landscape in India, the government has relaxed eligibility criteria for the procurement of 10,000 graphics processing units (GPUs) under the ambitious IndiaAI mission.

This initiative aims to foster participation among smaller players, including startups, and stimulate innovation in a rapidly evolving sector.

The Ministry of Information Technology has undertaken significant revisions to the tender requirements based on feedback from stakeholders during a pre-bid meeting held in September.

Many companies expressed concerns that the original tender specifications were overly restrictive, hindering the participation of smaller enterprises.

One of the key changes involves the turnover threshold for bidding companies. The average turnover requirement for primary bidders has been halved from Rs 100 crore to Rs 50 crore, while the threshold for non-primary consortium members has been reduced from Rs 50 crore to Rs 25 crore.

This adjustment allows a wider array of companies, particularly newer entrants, to engage in the procurement process, thus enhancing competition.

In addition to lowered turnover thresholds, the performance specifications for AI compute units have also been relaxed. Bidders are still required to possess at least 1,000 AI compute units on their cloud platform; however, the performance benchmarks have been notably eased.

Initially, bidders were expected to meet stringent performance thresholds of 15 TFLOPS for FP32 and 300 TFLOPS for FP16, alongside a requirement of 40 GB of AI compute memory. The revised standards now stipulate a reduced FP16 performance threshold of 150 TFLOPS and a decrease in AI compute memory to 24 GB.

To further accommodate smaller players, the tender process now allows bidders to provide a bank guarantee for anticipated AI compute units. This provision grants them a grace period of six months post-agreement to fulfill the requirements, offering additional flexibility for participants.

These adjustments are pivotal in cultivating a more inclusive environment for smaller players in the AI sector. By lowering turnover and performance requirements, the government is promoting diversity within the AI landscape, enabling startups and smaller firms to engage more easily in the procurement process.

Furthermore, with the relaxed specifications, these companies are not forced to invest in the most advanced and costly hardware, thus leveling the playing field.

The IndiaAI mission, which received government approval for a budget of Rs 10,732 crore in March, seeks to establish a robust computing infrastructure in the country.

This includes the development of AI centers for multi-modal large language models (LLMs) and enhancing the overall growth of the AI ecosystem.

(KNN Bureau)