India must seize physical AI manufacturing opportunity, says KPMG leader
KPMG's Purushothaman KG urges India to reduce import dependence by manufacturing AI-enabled devices like IoT and computer vision systems.
India stands at a critical juncture where the next wave of technological revolution will move from digital screens into the physical world. Purushothaman KG, National AI Leader and Head of Technology Transformation at KPMG in India, has emphasized that the nation must urgently seize emerging opportunities in physical AI to reduce its heavy reliance on imported technology.
Moving Beyond Digital Applications
Speaking at the India Mobile Congress 2026 in New Delhi, Purushothaman highlighted that the evolution of artificial intelligence is shifting. While the previous era focused on digital applications, the future belongs to physical AI—where intelligence is embedded into hardware and physical systems.
“The future is going to be not only digital AI but also physical AI. When it comes to physical AI, there are large investments happening around the world, and India needs to seize that opportunity,” he stated.
Reducing Import Dependence in Hardware
Currently, India faces a massive gap in hardware production. Purushothaman revealed that between 90 to 95 per cent of the current usage of certain technology products is driven by imports. This heavy dependence poses a strategic challenge as the demand for AI-enabled hardware surges.
He identified several key sectors where domestic manufacturing could thrive, including:
- Internet of Things (IoT) equipment
- Smart cameras
- Computer vision systems
- Connected AI-enabled devices
From Service Provider to Product Creator
India is undergoing a fundamental shift in its role within the global tech ecosystem. Traditionally known as a powerhouse for software and IT services, the country is now transitioning toward owning and developing indigenous products. This shift is being bolstered by government-led initiatives designed to strengthen local production.
Key drivers mentioned include:
- The Production-Linked Incentive (PLI) scheme for telecom.
- Proposed telecom manufacturing zones.
The Roadmap to 6G and Enterprise Solutions
As the industry matures, telecom operators are expanding their reach from simple consumer services into complex enterprise solutions, such as data centers, fintech, and healthcare digital transformation. However, the leap to the next generation of connectivity will take time.
Regarding the future of telecommunications, Purushothaman projected that the rollout of 6G infrastructure is likely to occur around 2029-30 or later, noting that existing 5G networks require time to reach maturity. The transition to 6G will necessitate significant advancements in network architecture, hardware, and embedded software.