Uttar Pradesh government abolished $Rs 25,000-crore MoU with artificial intelligence startup Puch AI amid criticism over the company’s credentials.
Prime Minister Yogi Adityanath’s government said the decision to cancel the MoU – signed on March 23 – was reached after reviewing the agreement in accordance with standard protocols. The state government said that necessary details as per Standard Operating Procedure (SOP) were sought from the investor, but they failed to provide them in time.
The state government said due diligence showed a lack of net worth and reliable financial links to the size of the project.
“Necessary details were sought from the investor as per standard operating procedures, but they failed to provide them timely. Due diligence showed lack of net worth and credible financial linkages for the size of the project. On the directions of the state government, the MoU has been canceled with effect from today. The UP government said through the X handle of Invest UP, the newly established investment promotion and facilitation agency of the state government,” the UP government said through the
The state government added that the MoU has been canceled in the interest of transparency and the highest level of integrity in governance
The memorandum of understanding signed with Puch AI has sparked sharp criticism over the company’s credentials, leading to clarifications from both sides and outlining a due diligence process from the state’s investment arm.
What is bosch artificial intelligence
Founded about a year ago by Siddharth Bhatia and Arjit Jain, Puch AI offers a voice AI service over WhatsApp. Critics in the tech community have dismissed the product as a “skin” built on existing AI models, specifically pointing to Google’s Gemma family, HT previously reported.
Bhatia had earlier admitted that the company does not have its own founding model, but said it has built its infrastructure on open source models specifically designed for Indian users, rather than relying on commercial APIs from companies like OpenAI or Anthropic.
Bhatia, who is also the CEO of the company, had earlier said that the company is “well-funded” and not bootstrapped, while declining to share financial details. Regarding the investment itself, he stressed that the structure is a partnership between the public and private sectors. “It does not entail any cost to the taxpayers of Uttar Pradesh. On the contrary, it brings investment into the state. The project will be implemented in phases, with the support of external investment partners. We have not taken any money, any GPUs, or any other form of support from the government,” an earlier HT report quoted him as saying.
