AI Wheels The Nation’s Vision of $26 Trillion Economy By India@100

The last time you drove your car, did you listen to a song on Apple Music or Spotify? Can you recall a journey where you resisted the temptation to open Google Maps, trusting your sense of direction instead? Every day, whether we’re conscious of it or not, we engage with Artificial Intelligence (AI). As Bill Gates once said, “The advance of technology is based on making it fit in so that you don't really even notice it, so it's part of everyday life." AI has seamlessly integrated into our daily lives, serving as an invaluable asset in both domestic settings and professional environments. Within workplaces, AI has revolutionised operations by automating countless repetitive and monotonous tasks. This liberation from mundane tasks empowers humans to redirect their focus on high-value work that requires critical thinking, problem-solving, and emotional intelligence.

India's booming economy, recognized as the world's fastest-growing, surges despite global headwinds. Projected to become the third-largest by 2027, its path to a $26 trillion future hinges on AI. This transformative technology, with its ability to boost productivity and efficiency, holds the key to accelerating India's growth and achieving its ambitious goals.

As per a study by BCG and NASSCOM, the AI market in India is projected to grow at ~25-35% CAGR till 2027, and GenAI to comprise 33% of the AI market. The growth is fueled by a large pool of AI talent and significant investments in the field. News headlines that read "Threads surpassed 1 million users in just an hour" and "ChatGPT acquired 1 million users in just 5 days" illustrate the explosive adoption of these AI tools. This necessitates the importance of human capital in the AI journey and organisations should accordingly invest heavily in upskilling and reskilling their workforce in AI and related technologies.

Companies are already allocating billions in significantly upskilling and reskilling initiatives. Skills in machine learning (ML), Python, and SQL continue to dominate current demand. India has the highest AI skills penetration and the demand for AI talent in India is expected to grow at 15% CAGR till 2027 to serve the AI market, as cited in the BCG and NASSCOM report.

AI across sectors

AI's impact will vary across different sectors, with business services, finance, transportation, education, retail, and healthcare expected to benefit the most. These sectors are particularly well-positioned to capitalise on AI's potential due to their ongoing digitalization and their focus on productivity, efficiency, and personalised experiences.

In manufacturing, AI is optimising production processes, reducing downtime, and enhancing quality control. Large manufacturing companies have implemented AI-based predictive analytics to enhance its maintenance strategies, resulting in a significant reduction in unplanned downtime and maintenance costs. Ecommerce giants use AI to provide personalised shopping experiences, optimise search results, and streamline logistics operations. Logistics companies use AI to provide end-to-end supply chain solutions, helping reduce logistics costs and improve delivery times. AI is transforming agriculture by enabling precision farming practices. The use of AI can provide farmers with real-time insights and recommendations, helping them make data-driven decisions to boost productivity and sustainability. Overall, AI is revolutionising every sector by enhancing efficiency, productivity, and personalised experiences, driving significant advancements across sectors, from manufacturing to agriculture.

AI impact on blue-collar jobs: Evolutionary, not revolutionary

The conversation around AI's impact on the workforce has largely centred on white-collar jobs. But what about the blue-collar sector, which comprises approximately 450 million? What about those individuals who construct the buildings and operate machines? What about those workers who install fibre optics and repair electrical systems in homes, factories, and businesses? Though AI and automation can transform some aspects of blue-collar work, the unique characteristics of these jobs, including task complexity, human interaction, environmental variability, cost considerations, regulatory constraints, and skill requirements, make them less susceptible to disruption compared to white-collar work.

Studies have shown that only an abysmal percentage of blue-collar jobs are at risk of being replaced by AI. In the blue-collar sector, AI will be more transformative than disruptive. However, it is essential to recognize that the impact of AI on employment may vary across industries and regions, and proactive measures are needed to support workers affected by technological change.

Government’s AI propel

Policymakers in India continue to balance promotion of AI and safeguarding against technology-related risk. Over the last few months, there have been several announcements related to both promotion and deployment of AI as well as regulating it to minimise the spread of misinformation, unlawful content and harmful AI generated content.

Fast-tracking India's AI future, the launch of INDIAai, the National AI Portal of India, by the MeitY, the National e-Governance Division, and NASSCOM signifies the government’s commitment to prepare the nation for an AI-driven future. Serving as a central hub for knowledge on artificial intelligence and related fields, the INDIAai portal is designed for entrepreneurs, students, professionals, academics, and anyone interested in AI.

The government has also established several 'Centres of Excellence' focused on various emerging technologies, including artificial intelligence. These centres bring together startups, enterprises, venture capitalists, government bodies, and academic institutions to address problem statements and develop innovative solutions.

Capitalising on AI's transformative power, India seeks to drive economic growth, enhance efficiencies across all sectors, and significantly improve the quality of life. Key strategies include investing in human capital, advancing digitization, and fostering a culture of innovation. Through these concerted efforts, India can not only achieve its ambitious vision of mass prosperity by India@100 but also establish itself as a global leader in the AI landscape.

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Authored by

Kartik Narayan, CEO, TeamLease

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Disclaimer: This article was first published on India AI.