New Delhi, Jul 22 (PTI) The march of AI casts a “huge pall of uncertainty” over impact on workers across skill levels, the Economic Survey said on Monday as it cautioned that alongside other factors this will create barriers to sustained high growth rates for India in coming years and decades.
In the preface, Chief Economic Advisor, V Anantha Nageswaran said “in any case, deploying capital-intensive and energy-intensive AI is probably one of the last things a growing, lower-middle-income economy needs”.
The corporate sector has a responsibility, as much to itself as to society, to think harder about ways Artificial Intelligence (AI) will augment labour rather than displace workers, he wrote.
Putting a spotlight on the hotly-debated issue of AI and job market, the Economic Survey 2023-24 made multiple, and repeated references to AI.
It acknowledges that the social impact of emerging technologies such as AI via labour market disruptions and labour displacement “is barely understood”.
The Survey mentioned that hiring in the IT sector has slowed significantly in the last two years.
Referring to the big shifts playing out, the Economic Survey said “… the advent of AI casts a huge pall of uncertainty as to its impact on workers across all skill levels – low, semi and high. These will create barriers and hurdles to sustained high growth rates for India in the coming years and decades.” Not mincing its words, the Survey called out the accelerated growth in AI as the biggest disruption for the future of work and admitted India would not remain immune to this transformation.
The Survey said AI is being recognised as a general-purpose technology, like electricity and the internet, which is phenomenal in its rapid pace of innovation and ease of diffusion.
“As AI systems continue to get smarter and adoption increases, the future of work will be reshaped. While AI has considerable potential for boosting productivity, it also has the potential to disrupt employment in certain sectors,” it said.
Citing potential areas set for disruption, it said routine tasks, including customer service, will likely witness a high degree of automation; creative sectors will see extensive usage of AI tools for image and video creation; personalised AI tutors can reshape education and sectors like healthcare can witness accelerated drug discovery.
Given the vast demographic dividend and a very young population, India is uniquely positioned as AI poses both risk and opportunity.
At particular risk is the BPO sector, where GenAI is revolutionising the performance of routine cognitive tasks through chatbots, and employment in the sector is estimated to decline considerably in the next ten years, it said.
In the following decade, however, gradual diffusion of AI is expected to augment productivity.
As per the survey, widespread adoption of AI across the services sector can significantly reshape and even replace jobs.
Citing industry’s job posting data points, it said, the demand for AI skills by businesses has a negative impact on the need for non AI roles and on the top percentile of wages, due to the displacement of high-skilled, managerial positions and non-routine, intellectual tasks.
“Given the affinity of India’s population to work with technology, as seen with the digital public infrastructure, proactive interventions by the government and industry can position India as a key player in the AI age,” according to the Survey.
To meet the AI challenge head-on, employees or job seekers would need skills beyond communication, collaboration, and presentation, such as analytical thinking and innovation; complex problem solving, critical thinking; learning and self-development; technology design and programming; and resilience and adaptability.
“Despite India being one of the leaders in AI globally, a review of existing literature shows that not much prior research has been done in India. This gap highlights the need for research and development in this sector,” the survey revealed.
It further observed that AI has made a significant growth in the agri-tech, industry and automotive, healthcare, BFSI and retail sectors in India. PTI PRS MBI DRR
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