AI Dispatch | India Expands Chip Push With $13.2 Billion Plan

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1. AI Dispatch | India Expands Chip Push With $13.2 Billion Plan

2. Zoho Builds AI Into Classroom Management

3. L&T Group to deploy Microsoft 365 Copilot for 140,000 staff

4. TCS Taps NVIDIA for Bengaluru Industrial AI Engineering Lab

5. India Approves $13.2 Billion Plan to Widen Semiconductor Push

6. Karnataka Plans State-Backed AI University

India expanded its semiconductor ambitions this week with the Union Cabinet approving a ₹1.275 trillion, or about $13.2 billion, chip program covering manufacturing, equipment, materials, research and domestic intellectual property. Fresh data, meanwhile, exposed a gap between widespread AI use and deeper engineering capability among young Indian technology workers. The country’s cybersecurity agency began testing indigenous AI tools to strengthen financial-sector defenses, while the government said it would examine how the technology is reshaping the expansion of global capability centers.

Globally, IBM acknowledged that it had failed to respond quickly enough as customers redirected technology budgets towards AI infrastructure. Meta withdrew an image-generation feature after a privacy backlash, Apple sued OpenAI over alleged trade-secret theft, and SoftBank’s Masayoshi Son predicted that AI could require $5 trillion in annual global investment by 2040.

India Approves $13.2 Billion Semiconductor Plan

The Union Cabinet approved a ₹1.275 trillion, or about $13.2 billion, semiconductor program on Wednesday, July 15, broadening India’s chip policy beyond fabrication and packaging plants to equipment, materials, advanced research, and domestic intellectual property.

Semicon 2.0 will support additional silicon, compound-semiconductor and display fabrication plants, as well as companies producing chipmaking equipment, specialty chemicals, gases and other materials.

The program marks a shift from the first phase of the India Semiconductor Mission, which focused heavily on attracting fabrication and assembly projects through government support covering as much as 50% of eligible project costs. The government has so far approved 12 semiconductor manufacturing projects involving investment of more than ₹1.64 trillion.

AI Use Rises but Engineering Depth Lags

Fewer than one in four early-career technology workers assessed in India qualified as AI-native, despite the widespread use of artificial intelligence tools, according to a Nasscom study. Nearly seven in 10 were classified as AI-proficient, while nine in 10 fell into either the AI-proficient or AI-native categories.

The findings suggest that frequent use of AI tools does not necessarily translate into the technical depth, judgment and independent problem-solving required to build and evaluate AI systems.

India Tests AI Cyber Sandbox

India’s national cybersecurity agency has begun using an indigenous testing platform and open-source AI models to identify vulnerabilities in systems operated by major public-sector financial institutions. The closed trial platform was developed by the Indian Computer Emergency Response Team, or Cert-In, over the past six months as the government prepares for cyber risks posed by increasingly capable AI systems.

Electronics and Information Technology Secretary S. Krishnan said the sandbox would help India prepare for AI-related threats. The government released its Digital Threat Report 2025–26 for the banking, financial services and insurance sector in New Delhi on Monday, July 13. The report said six of the seven major cyberthreats identified a year earlier had materialized.

MeitY to Examine AI’s Impact on GCC Growth

The central government will assess whether recent labor and tax reforms have accelerated the growth of global capability centers (GCCs) in India and whether AI is changing their expansion plans, MeitY Secretary S. Krishnan said.

Speaking at the CII Global GCC Business Summit in New Delhi, Krishnan said the central government and states had addressed several longstanding concerns involving taxation, labor rules and the ease of doing business. He said it was now time to examine whether those changes had produced measurable results.

Krishnan said GCCs account for nearly 2% of India’s gross domestic product, while information technology and IT-enabled services remain the country’s largest export sector, generating about $250 billion annually.

Global

IBM Says It Faltered as AI Upends Technology Spending

IBM said it failed to respond quickly enough as the AI infrastructure boom reshaped enterprise technology spending. The company said customers redirected spending toward servers, storage and memory during the final weeks of the second quarter, delaying large IBM contracts and contributing to weaker-than-expected results.

Chief Executive Arvind Krishna acknowledged that IBM had underestimated the speed and scale of the shift. “We did not adapt and move quickly enough, and numerous large deals failed to close on the timelines we expected, driving the majority of our shortfall,” Krishna wrote in a letter accompanying IBM’s preliminary results.

IBM reported second-quarter revenue of $17.2 billion, an increase of 1%, while infrastructure revenue fell 7%. Its shares subsequently recorded their steepest one-day decline in decades.

SoftBank’s Son Sees $5 Trillion in Annual AI Spending

Artificial intelligence could require $5 trillion in annual global investment by 2040, SoftBank Group Chairman and Chief Executive Masayoshi Son said, dismissing concerns that the sector is experiencing an investment bubble.

Speaking at SoftBank World in Tokyo on Tuesday, July 14, Son described an AI-driven economy in which spending on data centers, semiconductors, electricity, networks and robotics would rise in proportion to the technology’s contribution to global output. “If AI revenue makes up 20% of global gross domestic product by 2040, spending $5 trillion a year is a rounding error,” Son said.

Son also estimated that AI data centers could eventually require about 3 terawatts of electricity, forcing governments and companies to expand global power-generation capacity substantially.

Meta Pulls Image Feature After Privacy Backlash  

Meta withdrew an AI image-generation feature after criticism over its use of photographs from public Instagram accounts. The feature allowed people to generate and edit images using material posted by public accounts. Those accounts were included by default, requiring users to opt out rather than give prior consent.

The design prompted concerns that photographs could be used to create misleading or non-consensual digital replicas. Meta removed the feature three days after its introduction following the public backlash.

Apple Lawsuit Raises Stakes in AI Hardware Race

Apple sued OpenAI and two former employees on Friday, July 10, accusing them of misappropriating confidential information connected to hardware development. The complaint names former Apple employees Chang Liu and Tang Yew Tan, as well as OpenAI Foundation, OpenAI Group PBC and io Products.

Apple alleges that the former employees improperly accessed or retained information involving unreleased products, engineering processes, components, manufacturing techniques and supplier relationships. OpenAI has denied that it sought Apple’s confidential information.