New Delhi:
An estimated 26 per cent of India’s workforce will be powered by artificial intelligence (AI) across all industries and sectors, International Monetary Fund Deputy Managing Director Gita Gopinath told NDTV at the World Economic Forum in Davos, Switzerland, on Tuesday. “I’m exposed,” he said. .
It’s not all doom and gloom, as 14 percent of these jobs will benefit from the introduction of AI and related technologies. 12% will be battling the “displacement effect,” she said.
“…Of course there are labor market implications. If you look at India, for example, we estimate that about 26 percent[of the workforce]is exposed to AI…but of that, about 14 percent.” benefit, and the remaining 12 percent will have more of a “displacement effect.” ”
Her comments appear to be in line with what India’s G20 Sherpa Amitabh Kant said at the NDTV World Summit last October. Kant said progress was “inevitable” but would bring “new kinds of jobs… new scales of work.” “Therefore, we need to create more skilled talent in these fields (data science, machine learning, etc.),” he said.
Read | “AI is inevitable and will bring new kinds of jobs”: Amitabh Kant, NDTV
AI was a recurring theme at the NDTV Summit, with Prime Minister Narendra Modi’s opening remarks stating that the government is working to increase the use of AI in various sectors.
Read | ‘India has twice the AI power’: PM speaks at NDTV World Summit
AI’s impact on the global economy
Asked about the overall impact (of AI) on the global economy, Gopinath said, “There is a lot of uncertainty in terms of what AI will bring to the economy. I have an estimate.” ..This is between 0.1 and 0.8 percent each year. ”
“And given that the global growth rate is on average 3 (percent), this has a potentially large impact.”
Gopinath said the actual impact of AI on employment, whether in India or elsewhere, will depend on factors such as the speed at which the technology is developed and absorbed, and how quickly governments facilitate the integration of AI into employment. , pointed out that it depends on a variety of factors. workspace.
“There is a lot to be done in terms of building digital public infrastructure, upskilling employees to use this new technology, and creating the right environment for innovation and business to start. is at stake,” she told NDTV.
Global growth rate stable at 3.3%
On the larger issue of global economic growth, with the IMF pegging the growth rate at 3-3.5% for 2025/26, Gopinath said some of the world’s stronger economies, including India, China and European countries, They talked about the differences and specific challenges they face. Union.
“We think global growth will remain stable at 3% to 3.5%… but this is quite far off. On the other hand, we see the US as very strong, so we have revised our forecast upwards, but “China has its own challenges,” she explained.
“In terms of what countries need to do for balanced growth…this varies considerably from country to country. In the case of China, for example, we need to do more in terms of the real estate sector and the need to stimulate domestic demand. In Europe, they must take action to increase productivity to get growth back on track.
Read | IMF predicts increased global uncertainty in 2025. As for India…
IMF senior leaders also acknowledged the impact that global geopolitical tensions have on the global growth story, but adopted a pragmatic position on that front, stating that “…geopolitical tensions When it comes to … that’s what governments around the world have to do.” Deal with it…”
India’s economic slowdown is temporary
But he was far more optimistic about India’s growth story, saying the country remains the world’s fastest-growing major economy, even if the expected 6.5% growth rate this fiscal year is lower than initially expected. He pointed out that there is.
Gopinath said this was due to the delay in ramping up public investment after the federal elections between April and June last year. “We expect India to recover. As expected, consumption in the rural sector is also strengthening.”
India’s economic growth rate slowed to less than 5.5% in the July-September period last year due to sluggish manufacturing and mining sectors and sluggish consumption.
“With a view to raising growth rates to higher levels (i.e. beyond the 7.6% threshold required to achieve the ruling BJP’s Bikshit Bharat target), India is investing in public infrastructure and increasing “It should be easier to sell land, for example.”
Gopinath said it was also important for India to reduce some of its “quite high tariffs.”
Regarding President Trump’s tariff demands
Ms. Gopinath rejected (at all) the possibility of a tariff war following new President Donald Trump’s pledge to “overhaul our trading system and tax foreign countries.”
Read | Trump vows to ‘tax foreign countries’ if returned as president
He said the impact, particularly on India, will depend on what kind of tariffs are imposed, the size of the tariffs, and each country’s reaction.
Read | No day-one tariffs from President Trump, but trade overhaul planned
However, she noted that there was already “positive sentiment” in the United States after President Trump was sworn in for a second term on Monday, adding that “the United States is now the most popular place for foreign investors.” .
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