Sridhar Vembu, who previously stepped down as CEO to become Chief Scientist of Zoho, spoke in an interview with Chandra R Srikanth and Bhavya Dilipkumar of Moneycontrol on Monday, October 13, 2025. Explaining how his work life has changed after stepping down as CEO, Vembu said: “The big change is that I now spend a lot more time in code, about 70 percent of my time. I review code every day and file many patents. I enjoy it; I feel I’m meant to do this.”
On the Government of India’s Swadeshi tech push and its sustainability—especially as Zoho and Arattai have been in the spotlight—Vembu said: “For us, it’s a matter of conviction: India must be self-reliant in technology and able to trade on equal terms. What we don’t build we should be able to buy. Products are sold to us without being weaponised against us. That’s an unfortunate reality where countries don’t just sell us technology, they also dictate terms on what you can and cannot do. It shouldn’t be acceptable to any sovereign nation, including India.”
He added: “Technology has become pervasive in the last 25 years and is increasingly used as weapons in geopolitics. Whether we like it or not. All these truthless organisations like World Trade Organisations, no one talks about. That’s why it’s important to build domestic capability.”
Vembu noted that awareness is spreading—not just within the government but also among citizens and business leaders—that India must achieve self-reliance in critical technologies while continuing to engage in fair global trade.
Building Without External Funding
Explaining how Zoho ensures Arattai sustains itself as a private firm without raising external funding, Vembu said: “The technology behind Aratai is already used in Zoho’s Cliq product, which competes with Slack and Microsoft Teams and has been performing well. We do think that there is a way to monetise it independent of the consumer alone. We also have other Zoho technologies, like payments, that can integrate with Arattai for business use cases. We’re deeply immersed in code, updating the app weekly, new updates are rolling out, in fact one is coming this week, we are testing with focus groups.”
More than 1.5 million users are on board. “What is new is the broader push for Swadeshi software. Zoho’s adoption in government and private sectors is based on merit,” Vembu said.
He also highlighted that educational institutions—both government and private—are increasingly adopting Zoho products: “The push is not just in Government, we are also seeing it in the private sector and other educational institutions.”
Speaking about the semiconductor plan that was shelved, Vembu said: “Not in the near term. For at least the next six months, our focus is on Arattai, AI, and integrating AI into the Zoho suite. We don’t have bandwidth for the semiconductor plan right now.”
He added that Zoho’s labs team is currently working on multiple AI models: a 7-billion-parameter model and a 70-million-parameter model, both tuned for specific tasks.
AI, Geopolitics, and Global Trade Imbalance
When asked whether he was concerned that India could become merely a “daily active user (DAU) farm” for Big Tech firms investing heavily in India, Vembu said: “AI requires a multi-pronged approach. We need to build domestic technology, but GPUs are expensive and restricted, which is a risk. That is the weaponisation I spoke about. An Indian company or even any Indian organisation trying to buy GPUs is subject to a quota. The government could do something useful.
“If something is based in India, make sure that they comply with Indian law and make sure those laws include, for example, that the IP has to be registered in India or licensed to the parent. I think that should be an easy change,” he added.
Vembu, has called for foreign AI companies and Global Capability Centres (GCCs) operating in India to register their intellectual property (IP) in the country, saying that India’s top talent is being used to generate immense value overseas without commensurate benefits flowing back to the Indian economy.
“Why are Indian citizens working in India, generating valuable intellectual property, and why should that IP be registered only in America and not in India? And why should Indian taxes not be paid on the profits from that IP? Our brains are being harvested for it. Why shouldn’t we get paid for it?” Vembu said.
“I’m all for trade and global competition, but I also want to ensure that they pay their fair share for all. This ensures that Indian talent and national development benefit from the technology, rather than being extracted.”
Vembu emphasised: “The reason Zoho exists is not because I’m any kind of special genius. It’s because our average employee feels that national spirit, that we have to build for this nation, and in this nation.”
On what India should do to navigate this new phase of geopolitics, Vembu said: “We must aim for more symmetry in the technologies we trade. “Unfortunately, India has often received poor economic advice, especially from economists trained in the West—from places like Columbia, Chicago, or Harvard. They told us to focus only on services and import everything else. That advice was misguided. They don’t truly understand trade symmetry, the strategic nature of technology, or its national security implications.”
“In reality, the only real money in the global system is gold—and we can see what’s happening with gold now. This shows how fragile the current trading system is,” he added.
“India can play a vital role in restoring that balance by developing and owning key technologies. As our Prime Minister rightly said, when India has these technologies, we’ll share them—like we’ve done with UPI, not weaponize them. That’s the kind of new global order we must aspire to.”
On Zoho relying heavily on clients in North America amid its push for self-reliance, Vembu said: “Yes, we sell them very happily. We provide outstanding value. We provide great software and we are winning in the global open markets. And we will continue to do so. Just like Indians are buying Apple computers or use all this, Americans use our software. So, I’m very happy with that.”
On the AI Bubble and Real Productivity
When asked if he thinks AI is entering “bubble territory,” Vembu replied: “Definitely, there is. Some people are arguing it’s not because the multi-trillions will be justified by the productivity gains. But why aren’t they there already? That’s the question, right? For all the investments already made, we must be seeing dramatic gains in at least knowledge work. We are seeing some, but that’s not enough to commensurate with the amount of investment going in.”
Explaining with an example, he said: “Take actually one area that I’m familiar with, AI-based coding. I’m actually a fan of it. I use a lot of it for this. But I wouldn’t say it replaces a really good programmer. It augments them. In many cases, it’s getting this what we call the boilerplate code well. But that’s also a reflection of the poor state of languages and tooling, rather than only AI doing this dramatically.”
“If the languages and tooling were better, we would not have so much boilerplate, which means AI does not have an easy picking to optimise away the boilerplate. I mean, I can give you in content, if most of the essay you write is boilerplate, AI can generate it. But if you are going to say something very original, you better say it yourself. AI can help you come up with those thoughts, maybe refine your thinking, but you still have to write it. So that’s the same thing with programming too,” he further explained.
Looking ahead, Vembu said that for the next few months, apart from Arattai and AI initiatives, his focus will remain on coding: “Well, code and more code. I’m waking up to code and I’m going to sleep to code.”
Also Read: What They Said: Bill Gates, Elon Musk, Sam Altman and Others on AI
AI valuations are A bubble
In a separate interview with Shereen Bhan of CNBC-TV18 on Monday, Sridhar Vembu weighed in on the current surge in artificial intelligence, describing the market as a “financial bubble.”
“There’s a lot of round-tripping going on in AI right now,” Vembu told CNBC-TV18, referring to financial maneuvers where one company funds another to inflate revenue numbers. “This current boom makes me very uncomfortable. While AI as a technology has enormous promise, much of today’s investment is driven by hype rather than sustainable business fundamentals.”
Vembu pointed out that past technological waves—from fiber optics to e-commerce—also experienced financial bubbles. “The bubble could burst, and yet the underlying technology can continue to provide real value in the long term,” he explained.
He also highlighted practical concerns around AI deployment, such as the energy demands of large-scale data centers and the emergence of smaller, more efficient models capable of performing the same tasks. According to Vembu, distinguishing between the immediate financial frenzy and the long-term technological impact is critical.
“AI could be transformative over the next 10-15 years, but today we are witnessing a classic financial bubble,” he added.
This is a developing story, and more quotes and insights from Sridhar Vembu will be added as they become available.
If this article saved you time or helped you decide better, consider supporting our work.
Support Telecomtalk
