OpenAI will open its first India office in New Delhi later this year as it expands in its second-largest market by user numbers.

The US-based AI firm, backed by Microsoft, has registered as a legal entity in India and started building a local team.

The move comes after OpenAI launched its lowest-priced monthly ChatGPT plan in India at US$4.6, aiming at the country’s nearly 1 billion internet users.

India has the highest number of student users on ChatGPT, and weekly active users in the country have quadrupled over the past year.

OpenAI is currently facing legal challenges in India, with some news outlets and book publishers accusing it of using their content without permission to train ChatGPT. The company has denied these allegations.

It also competes with Google’s Gemini and AI startup Perplexity, both of which have made their advanced plans free for many users in the market.

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🔗 Source: Reuters

🧠 Food for thought

1️⃣ AI companies are treating India as a strategic battleground through aggressive pricing and partnerships

OpenAI’s $4.60 monthly plan represents its cheapest global offering, demonstrating how companies are adapting pricing strategies specifically for the Indian market1.

This pricing approach aligns with competitor strategies, with Perplexity offering free Pro subscriptions worth $200 annually to Airtel’s 360 million subscribers, and Google providing free AI Pro suite access to college students23.

The competition has intensified, with Perplexity’s downloads in India surging significantly year-over-year and the app becoming the top free app on Apple’s App Store in India, even surpassing ChatGPT43.

These tactics reflect India’s strategic importance as OpenAI’s second-largest market by user numbers, where weekly active users have grown substantially in the past year and the country hosts a large population of student users on ChatGPT1.

2️⃣ Legal uncertainties around AI training data are creating regulatory headwinds for expansion

OpenAI faces ongoing legal challenges in India from news outlets and publishers who accuse the company of using their content without permission to train ChatGPT1.

The most prominent case involves Asian News International alleging that OpenAI used copyrighted content without authorization, which could set a precedent for AI copyright interpretation across the Global South5.

These legal challenges have prompted the Indian government to review its copyright laws, creating regulatory uncertainty as the framework currently lacks explicit provisions for AI training65.

The timing of these legal reviews coincides with OpenAI’s office establishment, highlighting the complex regulatory landscape AI companies must navigate while expanding into emerging markets that lack clear AI governance frameworks.

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