Chief Economic Advisor V. Anantha Nageswaran stated on Thursday that artificial intelligence elevates the value of each working professional in India rather than replacing them. Speaking at the GCC Business Summit hosted by the Confederation of Indian Industry (CII), he addressed anxieties about automation and the evolution of India's capability hubs.
AI Requires Human Oversight
Nageswaran acknowledged that routine, repetitive, and rule-bound tasks are vulnerable to cheap automation, but well-run centers leverage technology to enhance human roles. He emphasized that AI needs human oversight to design, train, test, and govern systems. "AI does not therefore empty these centers. In the centers that are run well, the AI raises the value of each person who works there. So the risk is there, but that is not destiny. The centers that stand still will suffer. The centers that move up will thrive," he said.
India's GCC Landscape and Economic Impact
India hosts approximately half of the world's Global Capability Centers (GCCs), with over 2,000 centers employing more than 2 million professionals. Sector revenues exceed USD 60 billion, contributing nearly 2% to the national GDP. More than 1,200 of these centers perform advanced work in AI and machine learning, making India the second largest enterprise AI talent base globally.
From Cost to Capability
Nageswaran noted that global firms "first came to India for cost. They stayed for capability. That's an important difference. A cost advantage can be copied by the next low-cost country. A capability advantage is harder to build and harder to lose as well." He highlighted that global banks run trading platforms in Mumbai and Bengaluru, car makers design embedded systems in Chennai and Pune, and semiconductor firms conduct chip design locally. He cited German firm Merck's new campus in Bangalore, which holds the company's largest concentration of digital capability worldwide, making India its fourth largest workforce hub.
Caution Against Complacency
"Success can breed complacency. The advantage we hold today was built over time, but it can also erode. Other countries are watching us and copying us. Our costs are rising. In some skills, our talent is already scarce," Nageswaran cautioned. He observed that "what began as support became engineering and what began as engineering became product and what began as a back office became in many firms the place where global decisions are now made."
Mutual Benefits and Future Vision
The CEA stated that the benefit has flowed both ways: global firms got world-class work at a fair price, and Indian professionals got careers they "could not have imagined one generation earlier." GCC roles today often pay much more than traditional services jobs. He concluded: "Our goal should never be to make our people work like machines. Our goal should be to use machines so that our people are freed to do more of what only people can do, to reason, to decide, to take responsibility, and to exercise wisdom."
