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After Backlash and “Due Diligence”, UP Govt Cancels ₹25,000 Cr MoU with PuchAI

Puch AI Co founder Siddharth Bhatia with UP CM Yogi Adityanath in Lucknow city of UP in India on March 23, 2026
March 27, 2026 01:19 PM IST | Written by Neelam Sharma | Edited by Vaibhav Jha

The Uttar Pradesh government has cancelled its ₹25,000 crore Memorandum of Understanding (MoU) to develop AI infrastructure in the state with Puch AI, after public backlash over the Indian startup’s bandwidth to cover a project of this massive scale.

Four days after signing an MoU with Puch AI, the UP government has claimed that “due diligence” revealed lack of net worth and credible financial linkages of Puch AI.

“Necessary details as per SOP were sought from the investor, but they failed to provide them timely. Due diligence showed lack of net worth and credible financial linkages for the project’s scale. On directions of the State Government, the MoU is cancelled effective today. No rights or obligations remain,” read a statement from Invest UP official X handle.

An investigative report by Editor Vaibhav Jha of AI FrontPage had revealed how Puch AI was not present in any government databases as a registered entity in India, Singapore, US and UAE.

 

The report also revealed that the co-founders Siddharth Bhatia and Arjit Jain of PuchAI, had founded another company TurboML, a San Francisco based firm registered from a flat in Dwarka of New Delhi, with 99.99% equity held by an offshore American holdco under Bhatia’s name.

Officials said that as per government rules, Puch AI was asked to provide important financial and project details. However, the company did not submit the required information on time. When the government checked further, it found that the company did not have enough financial strength or clear funding sources to handle a very large project of ₹25,000 crore.

On March 23, the MoU was announced after a meeting between Chief Minister Yogi Adityanath and Puch AI co-founder Siddharth Bhatia. The company had promised to build AI parks, data centers, and even an AI university in the state with global investment at a budget of ₹25,000 crore.

The MoU soon erupted into a major controversy with citizens and opposition leaders including former CM Akhilesh Yadav criticizing the state government for choosing a bootstrapped AI startup for a project of this magnitude.

Despite big advertisements and bold claims, many people started questioning whether the company could really deliver such a huge project. Former Chief Minister Akhilesh Yadav had also raised doubts earlier.

After all these findings, the government cancelled the MoU with immediate effect. It clearly stated that now there are no rights or responsibilities left between the two sides. Puch AI has not responded to the MoU cancellation.

Also Read: Investigation: No Office, No Funding, No Filing- Inside Puch AI and ₹25,000 crore UP MoU

Authors

  • Neelam Sharma

    Neelam Sharma is a passionate storyteller, and journalist with over a decade of experience across leading Indian media houses.
    Known for her calm presence on screen and powerful storytelling off it, Neelam brings a rare blend of credibility, creativity, and empathy to journalism. Her strength lies in ground reporting and research-driven narratives that connect with the heart of the audience. Whether covering social issues, human-interest features, or breaking news, she combines factual depth with a human touch—making every story not just informative.
  • Vaibhav Jha

    Vaibhav Jha is an Editor and Co-founder of AI FrontPage. In his decade long career in journalism, Vaibhav has reported for publications including The Indian Express, Hindustan Times, and The New York Times, covering the intersection of technology, policy, and society. Outside work, he’s usually trying to persuade people to watch Anurag Kashyap films.

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