AI may disrupt Indian IT, but it’s also the industry’s next big growth engine: Herald van der Linde, HSBC
Well, this is deliciously ironic: the industry that automated everyone else's jobs is now being told that automation will fix its problems. Herald van der Linde from HSBC wants us to believe Indian IT can pirouette gracefully from 'we'll automate your business processes' to 'please automate our business model,' and somehow land on growth. It's not entirely wrong, but it requires pulling off the tech equivalent of a swan dive into a pool that hasn't been filled yet.
Here's the reality check: AI poses a genuine existential challenge to India's $250 billion IT services industry, which built its fortune on labor arbitrage and high-volume coding work—exactly what AI is designed to replace. HSBC's own analysis estimates AI could contract IT services revenues by 8-10% over three to four years. However, the silver lining isn't just optimism; it's structural. Indian IT firms are investing billions in AI infrastructure (TCS alone plans $5-7 billion in AI data centers), Global Capability Centers are pivoting toward high-value AI deployment work, and India's talent pool—bolstered by a demographic dividend and English-speaking STEM expertise—positions the country as a global AI execution hub. If Indian IT can successfully redeploy talent from commodity services to strategic AI implementation, the industry doesn't just survive; it transforms into something far more profitable.
