Anthropic has suspended access to its advanced Fable 5 and Mythos 5 models for foreign nationals following a US export-control directive citing national security concerns.
The development has intensified calls for indigenous AI capabilities, with industry leaders advocating greater investment in domestic foundation models and open-source alternatives.
While some push for sovereign frontier models, others, including Nandan Nilekani and N. Chandrasekaran, argue India should focus on building AI-powered applications and enterprise solutions.
US Blocks Foreign Access to Advanced AI Models, Putting India's AI Strategy Under Spotlight
US restrictions on Anthropic's flagship AI models have reignited calls for India to accelerate efforts toward building sovereign AI infrastructure and homegrown foundation models
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The US government's decision to restrict access to Anthropic's most advanced artificial intelligence models, Fable 5 and Mythos 5, for foreign nationals has reignited debate in India over the need for homegrown AI capabilities, Moneycontrol reported.
The move, reportedly issued under export-control directives on national security grounds, has drawn strong reactions from technology leaders including Zoho founder Sridhar Vembu, Lightspeed partner Hemant Mohapatra, Activate founder Aakrit Vaish, and former Infosys CFO Mohandas Pai.
They argued that the development highlights the risks of relying heavily on foreign AI platforms and infrastructure.
The discussion comes as India seeks to strengthen its own AI ecosystem. Earlier this year, the government selected 12 companies under the IndiaAI Mission to build indigenous foundation models, marking the country's biggest push yet toward sovereign large language models (LLMs).
Among the key contenders is Sarvam AI, which is reportedly in advanced talks to raise fresh capital. According to a Moneycontrol report, HCLTech is likely to invest $150 million (around ₹1,450 crore) and lead a funding round worth $300 million (about ₹2,850 crore) in the startup.
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Anthropic said it received the directive on June 12, requiring it to suspend access to Fable 5 and Mythos 5 for all foreign nationals, whether located inside or outside the United States.
The restrictions also apply to foreign-national employees working at the company. Access to Anthropic's other AI systems remains unaffected.
Case for Sovereign AI
Reacting to the development, Vembu said the episode demonstrated how access to advanced technologies is increasingly shaped by geopolitics.
"Technology is the ultimate weapon. National sovereignty, national security, all of it is now about technology," he wrote on X, adding that "globalization is dead and Bharat must find her own way ahead."
He also urged Indian organisations to explore smaller AI models, including domestic and open-source alternatives, rather than depending entirely on overseas providers.
The development has also revived a broader debate within India's technology sector.
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While supporters of sovereign AI advocate building frontier models domestically, others believe India's biggest opportunity lies in developing applications and sector-specific solutions.
Infosys co-founder Nandan Nilekani and TCS Chairman N. Chandrasekaran have both argued that enterprise adoption and practical AI use cases could create greater value than competing in the race to build the world's largest models.