Rapid growth of AI in India brings opportunities and challenges for workers

As artificial intelligence continues to advance at an unprecedented rate, it is reshaping industries, driving efficiency, and potentially displacing millions of jobs. However, experts also suggest that AI could create new opportunities, provided there is a concerted effort to reskill and adapt to the evolving job landscape.

With over 500 million people employed across various sectors, India accounts for one of the largest work forces in the world. However, with artificial intelligence experiencing unprecedented growth over the past decade, both in terms of user adoption and technological advancements, the landscape of jobs is beginning to change, creating both opportunities and challenges.

As of 2024, 82 pc of global companies are either using or exploring artificial intelligence within their operations. This marks a significant jump from just 37 pc in 2019, as reported by  Gartner. In India, AI adoption is particularly high, with around 59 pc of companies embracing this technology.

While the adoption of artificial intelligence has brought about significant advancements, it has also raised concerns about its impact on employment. According to a recent report by Marcellus Investment Managers, a portfolio management company, many routine and clerical roles are becoming increasingly obsolete, as companies prioritise cost-cutting strategies such as automation and outsourcing.

In its monthly report for September 2024, the Union Ministry of Finance said that “Anecdotal reports of the deployment of Artificial Intelligence displacing workers are beginning to emerge.”

Scale of AI integration in India

A report by National Association of Software and Service Companies (NASSCOM), published in 2023, says that AI and automation could potentially displace up to 69 million jobs in India by 2030.

The projection includes workers in sectors like manufacturing, retail, customer service, and transportation.

Another report by McKinsey Global Institute, part of the global consultancy firm McKinsey, states that about 63 pc of jobs in India are at risk of being affected by automation, with low-wage workers being the most vulnerable. Many of these positions involve routine tasks that are increasingly being automated through AI.

“Roles heavily reliant on repetitive tasks and minimal decision-making, such as traditional data entry, manual bookkeeping, or basic customer support, are likely to disappear as automation and AI take over these functions. Similarly, certain mid-level operational roles that primarily involve bridging communication between teams might diminish, as streamlined workflows and AI tools enable direct collaboration,” Abhishek Sauda, Human Resource executive for a Learning and Leadership Development multinational company, tells Media India Group.

The IT and tech sector, a major driver of India’s economy, is also feeling the heat. Accenture, an accountancy firm, says in a report that automation could replace up to 40 pc of tasks in India’s IT services industry by 2025, potentially displacing thousands of workers.

“The positions of repetitive or redundant tasks will see a shift in approach, shifting from requiring more people to essentially requiring a more skilled leader doing all their jobs using AI as a helper tool. Manual QA testing, basic IT support, entry level roles which require a lot of input resources are likely to be impacted the most,” Prashubh Atri, an IT professional, tells Media India Group.

The Upside: New Opportunities in AI

Despite numerous reports and concerns about AI potentially rendering humans obsolete, many experts argue that AI holds greater potential to enhance efficiency and reduce time costs, provided the workforce adapts and acquires the necessary skills.

Studies, such as those by McKinsey and PwC, highlight AI’s ability to automate repetitive tasks, allowing humans to focus on more complex and creative work, ultimately driving productivity. However, this transition comes with challenges, including the need for reskilling and addressing workforce displacement.

“I do not think AI will replace jobs in the near future. Instead, I see it as a way to enhance human work. In my role, AI could help with automating routine tasks like data analysis and reporting, but it can not replace the critical human skills needed for decision-making and managing relationships. I think the key is using AI to make our work more efficient and focus on tasks that require creativity and problem-solving,” Asad Ahmed, Assistant Project Manager, SAP, a consulting company, tells Media India Group.

Experts also emphasise that while AI may transform job roles, it is unlikely to eliminate human involvement entirely, and instead will augment human capabilities, offering opportunities for improved outcomes in various industries.

A study by ServiceNow, an American software company, in collaboration with Pearson, a publisher, has projected that AI could actually drive employment growth, creating an estimated 2.73 million jobs in India by 2028.

A study by the World Economic Forum suggests that while AI could displace 75 million jobs in India by 2025, it could also create 134 million new roles, many of them in fields like AI development, data science, and machine learning.

“AI is a tool, it will require supervision in order to validate the outcomes, we cannot really let it just do the job without supervision as that might lead to disastrous or just vague results. I surely see roles being adapted to oversee AI tools do the tasks and then generating good enough results for the real world,” says Atri.

India’s surging start-up ecosystem is beginning to capitalise on the demand for AI professionals, creating a surge in jobs related to the development, implementation, and maintenance of AI systems.

Moreover, sectors such as healthcare, education, and financial services are increasingly adopting AI to improve service delivery and efficiency. AI-driven diagnostic tools, personalised learning experiences, and financial forecasting models are just a few examples of how AI is augmenting human capabilities rather than replacing them entirely.

In these areas, AI is more likely to create complementary roles, where human intelligence and emotional acumen are still needed.

Need for Reskilling

As India faces this wave of AI-driven transformation, one of the most critical aspects of ensuring a smooth transition is reskilling. With millions of workers at risk of displacement, it is essential to focus on re-training programmes that equip them with the skills necessary for the emerging job market.

“Adaptability will be the cornerstone of future employability. Employees must focus on enhancing digital literacy, data analytics, and AI collaboration skills, as these are now foundational across industries. Equally important will be soft skills like critical thinking, creativity, emotional intelligence, and effective communication, which machines cannot replicate. Employees who can combine technical expertise with strategic problem-solving and a human-centred approach will be best positioned to thrive in this evolving landscape,” says Ahmed.

According to NASSCOM, India’s reskilling ecosystem is still in its nascent stages, and a more concerted effort from the government, corporations, and educational institutions is needed.

India’s National Skill Development Corporation (NSDC) has already started initiatives to promote skill development in fields like AI, machine learning, and robotics.

“AI can easily automate the tasks I do. It totally depends on how much these tech giants invest in automation. The more they invest, the earlier humans are going to be replaced. I know I can get laid off anytime, but as an individual, it is my responsibility to think smartly and do my own research to stay one step ahead of everyone else,” Dewang, a content moderator for HCL Tech, a leading technology firm, tells Media India Group.