A dramatic rise in RAM and NAND prices, soaring up to 500 per cent, is forcing Indian technology companies to rethink procurement and pricing strategies as AI-driven demand intensifies and supply chain issues persist.
For Indian technology companies, memory is no longer a routine procurement cost. The surge in prices for RAM and NAND has become a boardroom issue, raising the expense of devices, servers and cloud infrastructure at the same time as AI investment is pushing global demand higher. India Today reported that memory prices have risen by as much as 500 per cent over the past year, a shift that is now feeding directly into business margins.
Zoho co-founder Sridhar Vembu has argued that the pressure is already affecting pricing decisions, saying on X that memory prices and AI token costs have made business difficult and forced the company to delay price rises. Business leaders across the sector say the problem is most visible in infrastructure-heavy firms. Vishal Sirohi, chief executive of AI infrastructure company Island Computing, told India Today Tech that companies running their own hardware are feeling the increase first because the cost lands straight on procurement. He also said India is more exposed than some markets because supply chains are still maturing and the rupee’s weakness makes imported memory more expensive.
The effect is not confined to one part of the market. India Today quoted Yogesh Agrawal, co-founder of Consistent Infosystems, as saying sales in some segments had fallen by around 30 to 40 per cent as customers cut back in response to higher prices and volatile inventory costs. Business Standard has separately reported that the AI-led memory shortage is already threatening to make phones, televisions and PCs more expensive, as manufacturers prioritise high-bandwidth memory for AI systems over consumer-grade chips. That shift is tightening supply across the broader electronics market.
Software and SaaS providers are also being forced to reassess their spending. Tapan Acharya, chief revenue officer at Keka, told India Today Tech that the cost of running AI features has moved from a minor line item to a visible expense that customers are beginning to question. He said firms are now looking more closely at whether AI tools genuinely save time or money, while ordinary automation still has a clearer return. TechTarget has similarly reported that the memory squeeze is adding cost and complexity to enterprise AI adoption, because data-centre expansion is consuming large volumes of memory at a time when supply is constrained.
The response, for now, is efficiency. Sirohi said the industry needs to move more workloads onto shared infrastructure so the same result can be achieved with less memory. Acharya argued that companies should extend hardware lifecycles, negotiate longer contracts and avoid making product plans on the assumption that compute will keep getting cheaper. The longer-term outlook remains uncertain. India Today quoted Acharya as saying nobody really knows when the shortage will ease, while Tom’s Hardware has reported that Nvidia has warned major customers of further AI server price rises in 2027, reinforcing the view that memory costs may stay elevated if AI demand continues to outpace supply.
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