India cannot afford the scale of investment in data centres, if power bills go up, it will become a hot political issue: Zoho’s Sridhar Vembu

Sridhar Vembu, founder and CEO of Zoho Corp, says VC money always comes with strings attached

India must adopt a more energy-efficient approach to AI, or the country risks political and economic fallout, Zoho Corp’s founder and Chief Scientist Sridhar Vembu warned, highlighting the strain massive data centres could place on the nation’s power infrastructure.

“Massive new data centers are required. How many power stations are we going to build to supply these data centers? We are energy sufficient now, but if we increase energy requirements by 10x, maybe 50x due to AI, can we handle it? These are natural questions to ask,” Vembu said in an interview with Moneycontrol, stressing the need for sustainable AI solutions.

He drew parallels with the U.S., where AI investment has soared into the trillions of dollars but raised concerns about rising electricity costs and limited productivity gains.

Watch the full interview here

“A lot of sane voices think there’s a lot of hype and a bubble emerging. People are already complaining about higher electricity bills. Where is the productivity benefit? Where is my income going up?” Vembu noted.

In India, the stakes are higher.

“We cannot afford the scale of the investment for data centers, GPUs, and power plants. And if power bills go up, it will become a very hot political issue. So we have to take a much more sensible approach to this,” he said.

Vembu advocated for smaller, more efficient AI models, including edge intelligence, which deploys AI on devices like smartphones rather than centralised data centres.

“Edge intelligence costs very little to charge your phone. It also provides privacy benefits. These kinds of models are better long-term,” he said.

Watch the full interview here