Artificial Intelligence (AI) presents a decisive inflection point for India’s massive IT ecosystem, with industry veteran Nilesh Shah warning that it could either unlock unprecedented growth or disrupt a sector that currently contributes USD 350 billion in foreign exchange earnings.
In an interaction with ANI, Kotak Asset Management Company MD, Nilesh Shah underscored the scale of the stakes involved, noting that “either it is opportunity of a lifetime for us or it is a risk of a lifetime,” highlighting the dual-edged nature of AI adoption for India’s technology sector.
He pointed out that nearly “Four crore Indians directly or indirectly depend upon IT related sector... and collectively they earn 350 billion dollars of FX revenue,” stressing that any structural shift driven by AI will have wide economic implications.
Strategy must focus on AI applications and value chain
According to Shah, India must strategically position itself within the evolving AI value chain rather than remain a passive consumer of global technologies. He outlined a multi-pronged approach, beginning with application-layer innovation, like Large Language Models (LLMs)
“We have to encourage our entrepreneurs to create app using LLMs of other parties... LLMs are like highway. Can I run buses and motor cars on that highway so that people pay toll to me?” he said, indicating that monetisation will depend on building globally scalable AI applications.
He cited examples of Indian innovation in voice AI, noting how platforms like “Luna and Maya One... are closest to the human voice... they can sing, they can talk with feelings,” as evidence that India can compete in high-value AI use cases.
Focus on sovereign AI and global trust
Shah also emphasised the importance of building sovereign and secure AI infrastructure. Referring to domestic large language model initiatives, he said, “Can Sarvam become that alternative... where they can be reasonably assured that there is no backdoor, there is data protection, there is security,” positioning India as a trusted provider for the Global South.
Enterprise AI offers next big opportunity
Another critical opportunity lies in enterprise AI, where adoption challenges remain significant. “Enterprises take time to adopt to AI. AI requires data... Arranging data will be very important. Securing that data will be also important,” he explained, adding that implementation complexity could slow down global rollout.
He suggested that Indian IT firms could pivot toward this segment: “Can Indian IT transit to become enterprise AI provider to the world? If we can... capture enterprise AI opportunity, I think this will be opportunity of lifetime for India.”
Execution challenges remain key
However, Shah cautioned that execution will not be straightforward. “Is it as easy as I say? Answer is no. It will require a lot of efforts, but if we work, I think it is doable,” he said.
Shah’s assessment frames AI not merely as a technology upgrade, but as a structural transformation that could redefine India’s role in the global digital economy, making timely strategy and execution critical for sustaining growth in one of the country’s most vital sectors.
Published on April 23, 2026