As one of the honorary guests at the India AI Impact Summit 2026, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), has cautioned that AI could profoundly impact the global labour market, potentially affecting around 40% of jobs worldwide. She described the impending change as a “tsunami hitting the labour market,” with advanced economies facing even higher exposure — up to 60% of jobs. Emerging markets like India may see lower but still significant effects, estimated at around 26%.
Speaking at the India AI Impact Summit in New Delhi, Georgieva highlighted both the opportunities and risks of rapid AI adoption. She noted that AI has the potential to accelerate global economic growth by 0.8% annually, faster than pre-COVID trends, and could help India achieve its “Viksit Bharat” vision of becoming a developed nation with a USD 30 trillion economy by 2047.
Dual impact of AI: Enhancement vs displacement
Georgieva highlighted that AI will not uniformly destroy jobs but will transform them. In many cases, AI will enhance productivity, leading to higher wages for skilled workers and creating knock-on effects such as increased demand for services like hospitality and travel. IMF research suggests that for every AI-enhanced job, there could be a net addition of 1.3 jobs in the economy overall.
However, she warned of significant dislocation, particularly for routine, entry-level, and middle-skill roles that AI may replace rather than complement. Entry-level positions, often filled by young graduates, face the greatest vulnerability, potentially widening inequality and creating barriers for new workforce entrants. Advanced economies have already seen about one in ten jobs enhanced by AI, but the pace of change risks leaving many workers behind without adequate reskilling.
India’s unique position and the big test ahead
For India, Georgieva pointed to a relatively lower direct exposure compared to developed nations, thanks to its large services sector and demographic advantages. Yet, she stressed that the country faces a critical test – leveraging AI to drive inclusive growth while managing displacement risks.
Strong digital infrastructure and a young population make it great for India to adopt AI rapidly. However, the success will depend entirely on proactive policies in education, worker retraining, and social safety nets.
Georgieva urged governments worldwide to implement “guardrails” for AI—focusing on skills development, equitable access, and policies that prevent deepening divides between those who benefit from AI and those who do not. She reiterated that while AI brings excitement and productivity gains, failing to address its risks could increase inequality and stall progress toward shared prosperity.