Context:

• Artificial Intelligence (AI) is rapidly reshaping global economies.
• For India, the challenge lies in ensuring that AI enhances productivity and generates inclusive employment rather than deepening inequalities.

AI’s Potential Impact on Jobs and Economy:

• ServiceNow–Pearson AI Skills Research 2025 report: AI could reshape over 10.35 million jobs and create 3 million new tech roles in India by 2030, placing the country ahead of Singapore and Australia in AI transformation.
• International Labour Organisation (ILO) 2025 study:
  • Jobs may evolve with AI, rather than disappear.
  • Structural challenges like low skilling levels and informal workforce vulnerabilities remain key hurdles.
• Sectoral impact:
  • Agriculture: Limited exposure to AI.
  • Labour-intensive sectors: Especially services, which contributed 55% to GDP and 31% to employment in FY24, are highly vulnerable.

AI Pathways - Automation vs. Augmentation:

• Automation:
  • Replaces workers, increases efficiency.
  • Risks large-scale job losses.
• Augmentation:
  • Complements human effort.
  • Enhances productivity while preserving employment.
• Key argument (by Economist and Nobel Laureate Daron Acemoglu):
  • AI’s impact is a policy choice, not destiny.
  • India must avoid the automation trap.

Policy Priorities for Inclusive AI:

• Skilling and lifelong learning:
  • Embed digital and AI competencies across schools, ITIs, universities, and vocational centres.
  • Large-scale reskilling initiatives by firms like Infosys, Tata Steel, and Siemens show positive pathways.
• Reducing inequality:
  • Build inclusive infrastructure.
  • Programs like Atal Innovation Mission, Startup India, Future Skills PRIME, and Youth for Unnati and Vikas with AI must be scaled up.
• Fostering entrepreneurship:
  • Support MSMEs through access to digital tools, computing, and tailored skilling.
  • Focus on sustainable enterprises, not just unicorns.

Ensuring Competitive and Open AI Ecosystems:

• Prevent monopolisation by vertically integrated firms.
• Ensure contestability in AI markets:
  • Open APIs - A publicly available application programming interface that provides developers with programmatic access.
  • Interoperable systems.
  • Indigenous Small Language Models (SLMs) and vernacular AI tools.
• Treat computing, storage, and datasets as public goods under India’s Digital Public Infrastructure model.

Way Forward:

• AI should be seen as saarthi (charioteer), not vinashak (destroyer).
• With right policies, infrastructure, and skilling, India can transform AI into a driver of inclusive growth.
• Policy choices today will determine whether AI bridges or widens India’s employment and productivity gaps.

Conclusion:

• India stands at a critical juncture where the trajectory of AI adoption will determine whether it deepens inequalities or drives inclusive prosperity.
• By prioritising augmentation over automation, investing in skilling, and ensuring open, competitive AI ecosystems, India can harness AI as a transformative force for equitable and employment-rich growth.