Artificial Intelligence is transforming the world in unprecedented ways, creating new opportunities for human ingenuity and innovation across sectors and societies. As one of the fastest growing economies in the world, India has enormous potential to harness AI for inclusive development and progress, with the country’s IT and IT-enabled services (ITES) sectors playing a pivotal role in this transformation.
India’s Information Technology and Information Systems (ITES) industries have contributed significantly to India’s economic growth and boom, accounting for 7% of the country’s GDP and employing nearly 5.5 million people, making the sector a critical enabler in accelerating AI adoption and transformation in the country.
The AI Opportunity for IT Companies in India
The Indian IT industry is a global powerhouse and has been instrumental in positioning the country as a preferred investment destination for international investors and creating huge employment opportunities in India as well as in the US, Europe and other parts of the world. Having proven its capabilities in providing onshore and offshore services to global clients, AI now offers a whole new range of opportunities for IT companies in India.
According to a study by Harvard Business School, Keystone.AI, and GitHub, productivity gains from software developers adopting generative AI tools could contribute $1.5 trillion to the global economy. With India being one of the countries with the largest pool of developers and the highest penetration rate of AI skills, this potentially makes the Indian IT industry one of the biggest beneficiaries of AI productivity gains.
In India, the IT sector is one of the leading adopters of AI, with an adoption rate of 60-65%, compared to the national average of 48%, according to a recent study by recruitment firm TeamLease Digital. To harness the full potential of AI, IT players need to adopt a holistic and structured approach to AI implementation, by creating responsible AI councils to strategize and deploy AI across roles and functions.
The findings of the Microsoft LinkedIn Workplace Trends Index 2024 show that an overwhelming 92% of knowledge workers in India are using AI at work, higher than the global average, indicating how rapidly generative AI is pervading IT and other knowledge sectors in the country.
Co-pilots: a revolution for the industry
Generative AI Copilots have revolutionized the way employees work by helping them reduce time spent on repetitive tasks, improving their ability to focus on their work, and amplifying their creativity and ingenuity. Studies show that developers who use GitHub Copilot report being 75% more satisfied with their jobs and up to 55% more productive.
For employees, Copilot is a valuable companion that allows them to spend more time on meaningful tasks and be more productive. For businesses, in a world where agility is a competitive advantage, Copilot helps deliver value to customers faster and improve business results.
Customers across industries are seeing this benefit. We recently announced a partnership with Cognizant to bring Microsoft’s Generative AI and Copilots to millions of users to transform enterprise business operations, improve employee experiences, and accelerate cross-industry innovation.
Generative AI can be a game-changer for virtually every business in every industry, opening up new opportunities for innovation, efficiency, and growth. The overall benefits of generative AI also highlight an important distinction: it’s not just organizations that drive AI adoption, but employees, too, who see its value.
A skills-based approach to AI readiness
The IT industry has long invested in training and upskilling its workforce and has been a pioneer in promoting continuous employee learning, given the dynamic nature of the sector. However, generative AI has given new urgency to these efforts. The rapid diffusion of AI and its ubiquitous applicability have led to an explosion in demand for AI skills far outpacing supply and a race for ready-to-use talent.
To address this challenge, it is critical for the industry to adopt a skills-driven approach to AI and invest in upskilling and reskilling at scale. AI skills are already competing with experience when it comes to candidate selection. According to the Work Trend Index 2024, 80% of executives in India would rather hire a less experienced candidate with AI skills than a more experienced candidate without them.
The IT sector has invested in various initiatives and programs to reskill and upskill its employees and talent pool. Wipro has trained 200,000 people on the principles of generative AI. Nasdaq-listed Cognizant, which like Wipro has announced a $1 billion investment in generative AI, has trained 35,000 developers on GitHub Copilot and plans to train another 40,000.
Industry also needs to work closely with academia to ensure a future-ready talent pool that can meet the demand for AI skills. India has one of the largest pools of STEM graduates, around 2.5 million, and ensuring they are equipped with the skills needed for the AI era will be critical to sustaining the IT sector and India’s leadership position as a global hub for technology and innovation.
Historically, the IT sector has played a crucial role in job creation, contributing significantly to the country’s GDP and transforming the economic landscape. As the sector continues to evolve, the adoption of AI and the focus on training and developing the AI workforce will be critical to sustain its growth and competitive advantage. The growth and prospects of the Indian IT sector support the country’s aspirations to become a global leader in AI and technology and accelerate the inclusive development and progress of its people.
The author is Managing Director, ITES, Microsoft India
Disclaimer: These are the personal views of the author. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper.
First published: August 16, 2024 | 7:38 p.m. IST
