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Economic Survey Warns of AI’s Impact on Jobs, Calls for Urgent Action

AI may disrupt middle- and lower-income occupations, India advised to prepare for workforce transition

AI may displace middle, lower-income jobs,India urged to prepare for workforce transition

The Economic Survey 2024-25, tabled by Finance Minister Nirmala Sitharaman, has raised concerns about the potential impact of Artificial Intelligence (AI) on jobs, particularly for middle- and lower-income workers. While AI promises to revolutionize industries like healthcare, finance, and education, it also risks displacing a large portion of the workforce, especially in low-skilled roles.

The survey highlights that AI’s ability to surpass human decision-making in critical fields could lead to widespread job losses, particularly in India’s service-oriented economy. A significant portion of India’s IT workforce is engaged in low-value-added services, which are highly vulnerable to automation as companies look to cut costs by replacing labor with technology.

Drawing parallels with past industrial revolutions, the survey notes that technological advancements have often led to economic hardships, prolonged unemployment, and widening income inequalities. For India, which has a young and dynamic population, the challenge is not just creating jobs but also improving the quality of its workforce to adapt to AI-driven changes.

To address these challenges, the survey emphasizes the need for a collaborative effort between the government, private sector, and academia. Building robust social infrastructure, including enabling and insuring institutions, is crucial to help workers transition to medium- and high-skill jobs where AI can augment their efforts rather than replace them.

However, creating such institutions is a time-consuming process that requires significant intellectual and financial resources. Fortunately, the survey points out that AI is still in its early stages, giving India a window of opportunity to prepare for its widespread adoption.

The survey also highlights practical challenges facing AI developers, such as ensuring reliability, scalability, and efficiency. Addressing these issues will take time, providing India with additional breathing space to strengthen its foundations.

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The future of work, according to the survey, lies in Augmented Intelligence—a balance between human and machine capabilities. By integrating AI thoughtfully, India can enhance productivity and create a workforce that leverages technology to its advantage.

Policymakers are urged to balance innovation with societal costs, while the corporate sector is called upon to introduce AI responsibly. A tripartite collaboration between the government, private sector, and academia is essential to minimize the adverse effects of AI and ensure inclusive growth.

As India navigates this technological transformation, the focus must remain on creating opportunities that empower its workforce and harness the potential of AI for the greater good.

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Ajay Thakur

A curious learner with courage to gracefully accept shortcomings and work on same. A massive entertainment consumer myself Cinema,fashion,lifestyle and an active theatre participant.
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