It seems like a fairly sensible direction for their local chip development. The software development toolchains (especially GNU) and QEMU tend to follow closely behind the extension standards. So by the time someone’s got hardware actually shipping, there is already software available for it.
The main challenge for India’s SoC development in general will be all the peripherals needed for a modern SoC. DDR memory controllers, PCIe bus implementations, audio, video, and GPU core designs. There been some work on the RISC-V GPUs, but I haven’t heard of a serious push for that yet, open-source or closed source. I’m sure someone will try it at some point.
Fingers crossed. And hope other countries folo similar steps. IIT has been developing Shakti processor based on RISC-V for sometime maybe they will collaborate on the same https://shakti.org.in/software.html