Nirmala Sitharaman says foreign investor interest in India goes far beyond AI

Global capital may be rushing into artificial intelligence, but investor confidence in India stretches across a far wider economic base, Union Finance Minister Nirmala Sitharaman said on Tuesday.

While the worldwide surge in AI spending has drawn substantial capital flows towards the United States, Sitharaman noted that international investors looking at India are backing tangible growth across core industry, physical infrastructure and manufacturing. The country's expanding consumer base and stable policy environment continue to make it an essential destination for long-term industrial commitments.

That broader appeal was on immediate display in New Delhi, where South Korean automotive giant Hyundai Motor Group unveiled a $15.5 billion investment programme running through 2032. The announcement followed a meeting at the Prime Minister's Office between Prime Minister Narendra Modi and Hyundai Motor Group Executive Chair Euisun Chung.

Hyundai's multi-billion manufacturing pledge

Hyundai plans to expand its local production footprint, step up parts localisation, and establish India as a primary global export base. The South Korean manufacturer has also earmarked roughly $700 million specifically for an advanced research and development centre, complete with dedicated vehicle testing tracks.

The conglomerate, which employs more than 24,000 workers in the country, will set up a dedicated Indian investment vehicle to steer partnerships, electric vehicle charging systems, automotive financing, and supply chain expansion.

Hyundai confirmed that output at the newly acquired Pune facility will be expanded in phases, pushing the group's total Indian output well beyond its current 1.4 million vehicles per year.

Strategic tech ties with Washington

India's manufacturing push is developing alongside closer technology alignment with western partners. Speaking at the Bloomberg New Economy Forum, former US Commerce Secretary Gina Raimondo urged Washington and New Delhi to lock in deeper cooperation across both semiconductors and artificial intelligence to protect critical supply chains.

Raimondo recalled Prime Minister Modi framing bilateral engagement around the phrase "AI: America, India" during an earlier meeting, praising the country's entrepreneurial drive and technical talent. She argued that neither nation could manage the security challenges of rapid AI development alone, calling for joint work on shared safety standards, governance frameworks and workforce training.

Industry leaders abroad are similarly calling for structured guardrails as AI scales up. In an interview on Tuesday, Dell Technologies Chief Executive Michael Dell stressed that governments must take an active role in establishing controls for frontier models.

"I think we've always had technology that can do great things and maybe do some not-so-great things," Dell said. "Fire can heat your home. It can also burn down your whole village... so we have to have safeguards and controls."

For New Delhi, balancing high-tech partnerships with massive commitments in heavy industry validates the government's economic playbook: building out sovereign technological capacity while ensuring international manufacturers anchor their global supply chains firmly on Indian soil.