The Great IT Reset: Is Indian IT Crumbling – Or Rebuilding?

India’s $250 billion IT industry — the crown jewel of white-collar India — is facing its toughest challenge in decades. Headlines scream “AI is the future,” but the numbers tell a different story. Despite major AI investments, Indian IT giants like Infosys, TCS, Wipro, and HCLTech are struggling with stagnant growth. AI may be implemented, but it’s not driving expansion — it’s mostly replacing tasks and optimising processes.

Former Tech Mahindra CEO CP Gurnani calls this a “pause, not a collapse,” but the industry’s old service-based model is becoming obsolete. The innovation gap is wide: India holds just 0.37% of global AI patents compared to China’s 70%. While India has talent, it lacks the AI-driven innovation needed to lead. Global Capability Centers (GCCs) like Walmart, Google, and Meta are already advancing AI and product development in India, leaving legacy firms behind.

Indian IT also faces a talent bottleneck. Despite having over 70,000 AI professionals, freshers are waiting to be onboarded, and the hiring pace is slow. The focus is shifting from traditional coding jobs to roles like AI architects and prompt engineers. India’s IT firms must evolve to focus on platforms, products, and value creation — not just services.

The path forward is clear: India needs to build a national AI stack and foster deep-tech startups. Indian IT can’t afford to wait for disruption — it must drive it. The future of Indian IT depends on how well it adapts to the AI revolution. Will India lead or lag? Drop your thoughts in the comments.