3 min readLucknowMar 27, 2026 05:49 AM ISTUP Chief Minister Yogi AdityanathDays after a social media post raised questions on a Rs 25,000 crore Memorandum of Understanding (MoU) with Puch AI, the Uttar Pradesh government on Thursday cancelled the agreement, saying a review revealed a “lack of adequate net worth” of the company and “absence of credible financial linkages”.Two days ago, Chief Minister Yogi Adityanath had issued a clarification, emphasising that the agreement was only a preliminary step and not a final commitment.Officials on Thursday said the decision to scrap the MoU was made after a standard protocol review of the agreement that was signed on March 23.“Necessary details as per the standard operating protocol were sought from the investor, but they failed to provide them within the stipulated time. The due diligence process further revealed a lack of adequate net worth and absence of credible financial linkages required for a project of this scale, leading to the decision to cancel the MoU,” a statement issued by the UP government read.“On directions of the state government, the MoU stands cancelled with immediate effect. No rights or obligations remain,” it added, underlining that the move was taken in the interest of transparency and maintaining the highest standards of probity in governance.The now-cancelled MoU had been projected as a major investment in the artificial intelligence space, aligning with the state’s broader push to position itself as a hub for emerging technologies. However, officials maintained that adherence to due process remains paramount and any proposal failing to meet established norms would not be pursued.The government reiterated that while it remains open to investments, projects must meet financial credibility and transparency benchmarks before being approved or implemented.Story continues below this adFollowing a post from the CM’s X handle on Monday highlighting the scale and ambition of the proposed investment, several users on X were quick to add a community note to the post, questioning the startup’s capacity, noting its relatively small scale, and raising concerns about its execution capability.On Tuesday, Siddharth Bharia, the co-founder of Puch AI, which describes itself as “India’s first AI assistant”, had posted: “The MoU signed with the UP Government is structured as a public-private partnership. It does not involve any cost to the taxpayers of Uttar Pradesh. On the contrary, it brings investment into the state. The project will be executed in phases, with support from external investment partners.”Stay updated with the latest - Click here to follow us on Instagram© The Indian Express Pvt LtdTags:lucknowUP government