Kunal Shah’s Warning on AI Relevance in the Workforce

Kunal Shah, who is the founder of CRED and a co-founder of Freecharge, has issued a strong caution: Every expert must become AI-native to sustain their relevance. Those who refuse to accept this reality, he asserts, will ultimately be left behind.

Echoing these sentiments, India’s Economic Survey raises similar alarms. With automation posing a risk to millions of jobs in a workforce-heavy economy, the government is considering implementing an AI tax to mitigate the impact. Insights from a January 2024 IMF report indicate that such actions could contribute to funding reskilling initiatives and safeguarding economic stability.

AI: A Double-Edged Sword for India’s Economy

The survey describes AI as a double-edged sword, presenting “unprecedented opportunities and significant challenges.” Given India’s extensive workforce coupled with low wages, the potential for job dislocation is a more pressing concern compared to more affluent nations. To address this, the government has unveiled an AI roadmap which includes incentives for semiconductors and the development of domestic AI models, all aimed at harmonising innovation while protecting jobs.

Debate Surrounding AI Taxation

However, the proposal for an AI tax has its detractors. Gaurav Parab, principal research analyst at NelsonHall in the UK, warns that any nation that considers penalising businesses for adopting AI will risk falling irretrievably behind. Bloomberg also reports that banks, some of the earliest adopters of AI, may cut approximately 200,000 jobs within the next three to five years. Major Indian IT companies such as TCS and Wipro acknowledge that AI has already begun to slow down their hiring processes.

Opportunities for Reskilling Amidst Challenges

Conversely, there are those who perceive opportunities arising from reskilling. Nitin Bhatt, technology sector leader at EY-India, highlights that “AI’s promise lies in augmented intelligence—leveraging both human and machine capabilities.” The survey emphasises the necessity for a collaborative effort among the government, industry, and academia to guarantee that AI’s advantages are broadly disseminated.

At this juncture, the concept of AI taxation remains in the proposal phase. However, as automation continues to transform various industries, India’s capacity to adapt—through regulation, innovation, or workforce evolution—will play a critical role in shaping its economic trajectory.