India’s AI Funding Paradox: Investors Show Caution But Deal Activity Sees Momentum

This feature examines a seeming dichotomy in India’s AI ecosystem: while investors remain cautious due to valuation risk, capital allocation, and regulatory uncertainties, deal volumes in AI/ML continue to grow. The article explores market sentiment, capital deployment patterns, fund formation, exit expectations, challenges of scaling AI startups in India, and how deals are being structured in light of technological risk and commercial viability.