By Madan Padaki & Arup Roychoudhury. Respectively Co-founder and Policy Advisor, Global Alliance for Mass Entrepreneurship
Ahead of the Global AI Summit, to be hosted by New Delhi in February 2026, Niti Aayog has released three detailed reports on how the frontier technology can be used to advance Viksit Bharat goals. These reports set the stage for India’s positioning ahead of the flagship event.
The first report, titled AI for Viksit Bharat: The Opportunity for Accelerated Economic Growth, was released in mid-September. Drafted by McKinsey & Co, it argued how AI could potentially narrow the gap between India’s current real GDP growth (5.7% as per the report) and the aspirational 8% under Viksit Bharat. By automating routine tasks, enabling smarter decision-making, and driving innovation particularly in manufacturing, financial services, pharma, and automotive, the report sees AI boosting GDP by $500-600 billion through productivity improvements (for manufacturing and banking) and another $280-475 billion through AI-driven R&D (in pharma and auto).
The other two reports were released in October. Roadmap for Job Creation in the AI Economy, drafted by Nasscom and Boston Consulting Group, examines AI’s impact on the tech sector: by 2031, India could lose 1.5-2 million jobs to AI, but create 4 million opportunities. It says 60% of formal jobs in IT and BPO are susceptible to automation. It proposes an India AI Talent Mission to embed AI in education starting from schools, become a AI talent magnet through attractive visas and research funding, build reskilling programmes, create open-source AI commons, and operationalise a national compute infrastructure.
The third report, AI for Inclusive Societal Development, drafted by Deloitte, focuses on the nearly 500 million informal workers who form 90% of the workforce but contribute nearly half of GDP. It envisions transforming informal workers and identifies five systemic challenges: financial fragility, limited market access, inadequate skilling, weak social protection, and low productivity—all rooted in four barriers: trust deficit, poor access/usability, knowledge gaps, and outdated tools.
The emphasis of the reports on collaboration between policymakers, academia, and industry is timely; the framing of AI as a transformative lever for competitiveness is well put; and the scale of ambition is welcome. The report on societal development rightly identifies the uplift of rural and underprivileged sections as the focus areas with the help of AI and other emerging technologies.
However, the first report leaves several crucial questions unanswered vis-à-vis its sectoral focus, and its GDP projections may be overly optimistic, especially when it talks about only four specific sectors: manufacturing, financial services, pharma, and the automotive industry.
In national income classifications, the automotive and pharma industries are both considered a part of manufacturing, which cumulatively contributed only 14% to India’s gross value added (GVA) according to the last available official GDP data (April-June FY26); 26% of GVA came from financial, real estate and professional services, of which banking is a part.
The claim that integrating AI into these four sectors would boost India’s economy by $1 trillion is far-fetched. Others like infra construction, textiles, hospitality, tourism, and agriculture and allied activities generate massive employment.
Food processing, logistics, and storage, where perishable losses are massive and where AI could drive efficiency without threatening jobs, do not find any mention. Similarly, agriculture, which supports 45% of India’s workforce and generates 18% of GVA, has an immense potential for AI-led transformation in precision farming, supply chain optimisation, rural credit, and market linkages.
The report acknowledges the need for reskilling but stops short of mapping the real-world implications of workforce displacement. Its assumption that jobs lost to AI will be redeployed within the same sector is a little too simplistic in the context of India’s labour market.
The report on job creation has similar shortcomings. By focusing only on tech and BPO, it ignores the potential impact AI may have on white-collar jobs in other sectors like retail, financial services, media, and legal. For example, the banking, financial services, and insurance sector employs 6-9 million people. The impact of AI is seen in roles such as bank tellers, loan processors, financial analysts, fraud detection, risk assessment, and insurance underwriting and claims processing.
Unemployment is one of India’s biggest economic and political issues. There are way more job seekers than positions, and it is near impossible to expect that jobs lost to AI will be absorbed within the same sector. The first report rightly talks about the need to retrain workforce across the four sectors, and making AI accessible for MSMEs. However, it should be done in a manner that causes minimum attrition. McKinsey’s own study last year said MSMEs contribute over 60% to India’s employment.
More importantly, any report endorsed by the government must focus on AI use in rural areas. After all, top policymakers including Prime Minister Narendra Modi have repeatedly spoken of AI as a digital public good. The report assumes AI gains from large manufacturing and banking will somehow reach small farmers, village entrepreneurs, and rural service providers. Given the mobile penetration in villages, AI-enabled applications in agriculture, rural healthcare, education, and entrepreneurship could have transformative outcomes. Such a possibility awaits structured execution.
As India prepares to host the Global AI Summit, it is worth remembering that setting the tone for the Global South requires more than projections based on select sectors. It requires demonstrating how cutting-edge technology can be harnessed for inclusive growth. The three reports are a valuable starting framework. The road ahead will be defined not by ambition alone, but clear action plans, sectoral inclusivity, and, above all, ensuring rural and underprivileged communities are not left behind.