Mumbai, February 24 Amid widespread concerns about jobs and the relevance of India's nearly USD 300 billion IT services sector, a key industry leader said on Tuesday that the current transition will be "painful" because it involves humans.
HCL Technologies Managing Director and Chief Executive C Vijayakumar, however, said this is not the time to write an obituary for the industry, emphasizing that the ability to manage complex enterprise technology architectures and domain understanding will ensure its relevance.
Recounting how the industry navigated changes like the opportunities after the Y2K in the past, Vijayakumar said the industry will have to reinvent, and added that investor concerns about IT stocks are "overblown".
"I would say this transition (brought about by AI) is different from the other transitions. It is going to be painful because it really involves people," the CEO of the third largest Indian IT services company said while speaking at industry lobby group Nasscom's NTLF event here.
It can be recalled that many tech companies globally, and also some in India, have opted to lay off employees as AI models automate work and do it more efficiently.
Vijayakumar said that IT services companies deal with a lot of complexities and the context in which they operate will make them relevant.
This is the biggest inflection point for the Indian IT sector and an opportunity to completely reimagine the sector over the next 5-10 years, he said.
Emphasizing that the industry has a "promising road ahead", Vijayakumar pointed out that while Anthropic's Claude will be very good at coding -- only 30 per cent of software development involves coding.
Demand for specialized skills will grow in the future, he said, adding that people will have to focus on doing innovative and higher-order work.
Later, he told reporters that there is a need for reskilling and ensuring how the same person can deliver up to four times efficiencies using AI tools.
About the strides announced by Anthropic in streamlining COBOL Code overnight, Vijayakumar hinted that COBOL conversion is one part of the wider modernisation work of the 50-year-old mainframe, hinting that there will be opportunities.
He said that software as a service (SaaS) companies, who reported high growth in the last few years by charging more from clients, will be the ones who stand to face some challenges going forward as they are not able to realise the same prices.
Vijayakumar also suggested that the hyperscalers who invest very high sums of money in setting up infrastructure, may find it challenging going ahead as revenues they book will not be high enough to justify the investments.
