AUTOMATION EXPOSURE AND INDIAS SERVICES-LED GROWTH MODEL: HOW AI ADOPTION COULD RESHAPE WHITE-COLLAR EMPLOYMENT

Indias economic growth over the past few decades has been strongly supported by services, particularly information technology, business process management and professional services. These industries have created millions of relatively skilled jobs and have made India an important exporter of digitally delivered services. The rapid development of artificial intelligence (AI), however, creates a new question for this growth model: what happens when technologies capable of performing cognitive and routine white collar tasks become increasingly available? This paper examines the potential impact of AI adoption on India's services-led growth model. It considers the importance of IT and business services to the Indian economy, the exposure of different types of occupations to AI, and early evidence of AI adoption within India's technology sector. The analysis suggests that AI is unlikely to simply eliminate large numbers of jobs overnight. Instead, it is more likely to change the tasks performed by workers, reduce demand for some routine activities and increase demand for workers with advanced technical, analytical and interpersonal skills. This transition could create productivity gains for India, but it may also increase wage inequality if opportunities for reskilling are unevenly distributed.