What Analysts Are Actually Saying About AI's Impact on Indian IT

India's IT services industry, currently sized at roughly $280 billion, has spent much of 2026 under a specific kind of scrutiny: not whether AI will change how software services get delivered, but how much of the existing workforce and revenue model survives the transition. Recent sector research from ICICI Direct offers one of the more granular breakdowns of what that shift actually looks like in numbers, rather than headlines.

The Numbers Behind the Disruption

According to the analysis, AI-led delivery models are expected to displace around 92 million traditional IT services jobs in India, even as the same shift is projected to create roughly 170 million new roles across the industry — net job creation, but with a substantial and disruptive churn in between. The research places peak disruption impact between FY26 and FY28, with a broader recovery in the sector not expected until FY28-end or into FY29. That timeline matters: it suggests analysts see this less as a one-time shock and more as a multi-year restructuring the industry has to work through in real time.

Given that outlook, the sector's current analyst view sits at "Neutral" rather than a broad buy or sell call — a stance that reflects genuine uncertainty about how quickly revenue deflation pressures in IT services get offset by AI-driven demand, rather than conviction in either direction. Within that neutral stance, select names are still flagged as relative standouts based on valuation comfort and how effectively they appear to be managing the shift toward AI-led delivery — a reminder that sector-level caution doesn't mean every company inside it is equally exposed.

A Different Kind of Disruption Story Elsewhere in Manufacturing

At the India Investor Conference 2026, a separate panel of industry leaders — including Atul Lall of Dixon Technologies, Aravind Melligeri of Aequs, Rajesh Agarwal of Micromax Informatics and Jasbir Singh Gujral of Syrma SGS Technology — offered perspective on India's electronics manufacturing ecosystem, a sector experiencing a very different kind of transition: rapid capacity build-out rather than workforce disruption, driven by global supply-chain diversification away from a single-country manufacturing base.

Separately, Kushal Desai, Chairman and Managing Director of APAR Industries, used the same conference to discuss the structural forces reshaping India's power sector — pointing to transmission, distribution, renewable energy and the surging power demand from data centers as overlapping growth areas that are, in effect, being pulled forward by the same AI infrastructure boom that is disrupting IT services on the other side of the economy.

Why Experts Disagree on Timing, Not Direction

What's notable across this research is that the disagreement among industry experts isn't really about whether AI reshapes Indian IT — nearly everyone agrees it will. The disagreement is about pacing: how long the disruption window runs, how much of the 92 million displaced roles gets absorbed into the 170 million new ones without a painful gap in between, and which companies are positioned to manage that transition rather than be overwhelmed by it.

Why It Matters for Industry Experts

For a sector that has been one of India's largest employers and export earners for two decades, this kind of granular, numbers-first analyst perspective is a useful corrective to both extremes of the public conversation — the assumption that AI simply erases IT services jobs, and the assumption that demand will absorb any disruption without friction. The reality analysts are pointing to sits in between: real short-term pain, a multi-year adjustment window, and a sector that comes out the other side larger, but structurally different from how it looked going in.

Industry Experts

At www.elevatexstudios.com / ElevateX Studios, Industry Experts, part of our Interviews series, brings you the analysis and sector-level perspective of the economists, strategists and industry leaders reading India's business trends before they become headlines.