AI technology to shape future economies, India emerges as a leader: Economic survey

Artificial intelligence (AI) is becoming an integral part of various economic activities, with significant global prosperity implications. As per the Economic Survey which was released on Monday (22 July), steering technological choices towards collective welfare is crucial. Employers have to find a balance between deploying technology and maintaining labour forces to maximize benefits.

AI- A strategic differentiator

In the new technologies, AI has been one of the emerging techs as major strategic differentiators that determine the economic prosperity of nations. The survey further emphasizes that AI, along with decentralized finance, machine learning, and the Internet of Things (IoT), has the potential to disrupt and transform the digital payments ecosystem significantly in the coming years (timeline unspecified).

India’s vision: A ‘Fintech Nation’

India has been focusing on evolving into a ‘fintech nation’ with the highest number of fintech firms and the highest adoption rate of fintech by incumbents. 

This vision is further supported by the country’s robust digital public infrastructure, which is expected to fuel the growth accordingly.

Global partnership and domestic initiatives

India is a founding member of the Global Partnership on Artificial Intelligence (GPAI), and it joined the multi-stakeholder initiative in June 2020. Since then, India has actively contributed to GPAI’s goals and objectives and has launched various domestic initiatives to promote the responsible development, adoption of AI and deployment.

Government support and investments

The Union Cabinet has approved an allocation of over Rs 10,300 crore towards the comprehensive IndiaAI mission, which aims to democratize access to AI innovation pillars and enhance the global competitiveness of India’s AI ecosystem.

AI as an investment magnet

As per the research by Nasscom, the IT industry’s apex body highlights that India is an attractive destination for AI investments due to its relatively low operating costs and its large pool of highly skilled AI, machine learning, and big data professionals. India boasts the world’s second-largest pool of such talent, making it a compelling choice for global AI investments.

Social Impact and labour market disruptions

While the productivity-enhancing potential of technology, especially AI, is beyond doubt, its social impact remains complex. 

The Economic Survey notes that emerging technologies like AI could cause labour market disruptions and displacement. This could potentially skew the distribution of income towards the capital at the expense of labour.

The advent of AI brings significant uncertainty regarding its impact on workers across all skill levels—low, semi, and high. These disruptions pose challenges to sustaining high growth rates for India in the coming years and decades.

The Economic Survey further suggests that overcoming these challenges will require a grand alliance between the Union and state governments and the private sector. This collaborative approach is essential to mitigate the social impacts of AI and ensure sustained economic growth.

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Inputs from IANS