Indian Businesses Eye Small Language Models, Generative AI Puts Hardware Back In Spotlight: Deloitte

Indian businesses are increasingly adopting small, multimodal models to meet the demand for more efficient, faster and targeted solutions, a new report by Deloitte shows.

According to the Tech Trends – India Perspective report, integrating small language models, artificial intelligence-based simulations and task-specific AI agents will drive the development of more personalised and context-aware solutions across industries.

The report discusses how AI is the backbone of emerging technological trends, driving innovation and fuelling advancements in supporting technologies. The tech ecosystem in India is seeing the integration and spread of AI, which is changing industries and opening the door to transformation.

The report claims that hardware is once again at the forefront of the technology discussion due to generative AI's expansion. To satisfy the needs of sophisticated AI systems, hardware—which was formerly thought to be mostly a static and commoditised layer with minor enhancements throughout product cycles—is now being redesigned. 

AI-powered technology, from robots to the Internet of Things, is changing industries by enabling smarter gadgets and more effective systems, opening up new avenues for innovation. Specialised chips for critical applications, including power management, telecommunications and cryptographic acceleration, are becoming even more critical, the report noted. 

Additionally, integrating heterogeneous computing, where graphics processing units and neural processing units are combined on a single chip, is unlocking efficiency and performance for AI workloads. Hardware is this actively influencing innovation rather than merely facilitating it, fostering a closer integration between AI capabilities and the systems that power them.

The report underlines how spatial computing, driven by AI technologies, is enabling systems to shift from being reactive to proactive by anticipating needs and addressing challenges before they arise. AI is helping advance this change by enhancing the processing and analysis of data from a range of sensors, including cameras, LiDAR and motion detectors. 

The report noted that AI-powered mixed reality in the defence industry is facilitating quicker, more strategic decision-making through autonomous systems and improving readiness through realistic simulations. 

In the IT sector, tech talent's capabilities are being enhanced by AI. Code creation, software testing and automation are among AI's uses, which boosts productivity and decreases manual effort. This is encouraging businesses to move from traditional virtualisation models to more scalable, cost-effective, AI-driven solutions.

In sectors like healthcare, virtual environments are boosting surgical training and diagnostic accuracy.

The report also highlights that the impending Year to Quantum era presents the risk of potential breakdown of traditional encryption. This makes the adoption of quantum-safe encryption and stronger defences crucial to securing India's digital future.