India’s outsourcing industry is facing a major upheaval as rapid adoption of artificial intelligence threatens to eliminate tens of thousands of jobs over the next two to three years.
Mark Serdar, who advises Fortune 500 companies on global workforce strategy, warned that “AI is going to crush entry-level white-collar hiring over the next 24 to 36 months,” adding that the shift toward automation is advancing faster than most people realize.
Some estimates suggest an initial wave could cost as many as 42,000 call-center positions, even as AI tools have helped create thousands of new roles in India’s broader technology sector. Today, roughly three million Indians provide customer support, software development, accounting, marketing and other back-office services for companies including Verizon, JPMorgan, Microsoft, Walmart, HSBC and Shell.
Ajai Chowdhry, co-founder of Hindustan Computers Limited, said generative AI will upend traditional business-process outsourcing and coding jobs, and urged domestic firms to pivot from services toward product design and manufacturing if they want to stay competitive.
K Krithivasan, chief executive of Tata Consultancy Services, recently told the Financial Times that within a year there may be only a “minimal” need for call centers if current automation trends continue.
Economists and industry leaders say India must invest heavily in manufacturing, research and product innovation to diversify an economy long dependent on back-office services. Without such a shift, one of the country’s last major engines of job creation could sputter just as unemployment begins to rise.