Think tanning and pigmentation are the same? Experts decode the crucial differences between the twoTanning and pigmentation are often used interchangeably, but there’s quite a difference between the two. Experts decode the difference. Published on: May 26
‘Don’t visit Sikkim if you litter’: Anand Mahindra sparks civic sense debateAnand Mahindra’s X post on littering in Sikkim has gone viral, sparking debate on civic responsibility and tourist behaviour. Updated on: May 26, 2026 4:46 PM IST By Vaishali Kapila Share via Copy link Industrialist
China and Pakistan have reached a "new broad consensus" on deepening strategic ties to beef up development of a joint economic corridor and establish the port of Gwadar as a regional connectivity hub, the neighbours said on Tuesday (May 26, 2026)
Editorial independence is core to our work. Some links may earn us a commission, without influencing our opinions.Backpacking across Europe? A solo traveller and content creator suggests the perfect packing listA solo traveller shares the smartest Europe backpacking essentials
Woman shows ladoos melting in Delhi heat, says ‘Inki abh barfi banegi’A viral video showing boxes of ladoos turning into a soft mess has left the internet amused, as people react with memes and relatable summer experiences. Updated on: May 26
Claude plugin threatens Indian IT’s ‘back office of the world’ model
This article was originally published in Rest of World, which covers technology’s impact outside the West.
On February 4, the $300 billion Indian IT sector faced a moment of reckoning.
The country’s benchmark IT stocks index slumped nearly 6%, reacting to Anthropic’s release of its Claude Cowork agentic plugin.
The new plugins are designed to automate precisely the high-volume, repetitive knowledge work that has been the bread and butter of Indian IT: contract reviews, regulatory compliance tracking, and sales forecasting, among other things. The stock sell-off was triggered by fears that clients could now use AI for such tasks instead of outsourcing them to companies in India.
This was the first concrete sign of AI’s long-feared threat to the industry, which makes for 10% of India’s GDP and directly employs 5 million people.
Indian IT firms have been preparing for this eventuality. Still, experts who have observed the industry closely believe many of these companies and their services will soon become obsolete. AI won’t kill the entire sector, they said, but only the companies that innovate and adapt to AI quickly will thrive in the future.
“The math is simple: If a U. company can automate legal contract reviews internally using Claude Cowork or OpenAI Codex, why would they pay for a 50-person team in Bengaluru to do it?” Ishan Talathi, co-founder of Pune-based cloud infrastructure firm CloudPe, told Rest of World. “The Indian IT model is built on man-day billing; we charge for bodies on projects. That model is now facing existential pressure.”
Over the past four decades, India has become the “back office of the world”, recruiting affordable labour in cities like Bengaluru, Hyderabad, and Pune to execute low-end tech-related tasks for clients in North America and Europe. The cost of labour in India can be 60%–80% cheaper than in the West.
Talathi believes up to half of traditional outsourcing work is directly exposed to extinction by AI, with areas like contract reviews, compliance documentation, data processing, routine coding, and testing being the most vulnerable.
The business model shift “forces an overdue evolution from cost arbitrage to genuine innovation, which is healthy, [but] a mismanaged transition could devastate urban economies, real estate, and ancillary services,” Talathi warned.
Typically, IT services companies rely on billable hours – charging clients for the amount of time spent on projects. With a smaller workforce and more AI, “the timelines of engagements will massively shrink further, impacting billing”, Yugal Joshi, partner at global research firm Everest Group, told Rest of World.
In recent years, companies have been trying to insulate their business models. Market leaders Tata Consultancy Services and Infosys have been integrating generative AI and machine learning into their core business processes and offerings.
By mid-2025, India’s top five IT companies had trained more than 250,000 employees on AI.
TCS – the biggest Indian IT firm and the first and only one to publicly disclose this information so far – pegs its annualised AI services revenue at $1.8 billion. That’s around 5% of the company’s quarterly consolidated revenue.
“Large enterprises don’t engage Indian IT firms to run isolated tasks; they outsource complex, interdependent systems with accountability attached,” Nirmit Biswas, senior research analyst at Market Research Future, told Rest of World. “AI tools may shorten delivery cycles, but they don’t replace vendor responsibility for uptime, integration, compliance, or transformation outcomes.”
Biswas estimates only “roughly a fifth of the effort embedded in traditional IT delivery” to be affected by AI. “That does not translate into a similar proportion of revenue at risk,” he said.
As of now, experts said, junior roles that execute repetitive, standardised tasks are most vulnerable. Mid-level jobs with low specialisation could also become redundant in the next decade. Workers who upskill will likely continue to earn good salaries.
“AI should not be viewed as an existential risk to Indian IT, but as a filter,” Biswas said.
Some believe that AI’s threats may push the Indian IT industry into a better direction.
“The scaremongering has some merit, and not every tech services firm will survive,” Joshi said. “The impact will not depend on an industrywide AI impact, but the strategic initiatives each service provider undertakes. Speed to partner with AI vendors, scaling solutions, and internal operating model transformation will be crucial.”
Ananya Bhattacharya is a reporter for Rest of World covering South Asia's tech scene. She is based in Mumbai, India.
This article was originally published in Rest of World, which covers technology’s impact outside the West.
Source: Scroll
Related Posts: Bondi Beach gunman originally from India DIIs continue to provide strong support to markets driven by strong domestic Row Erupts In Punjab As Centre Moves To Bring Chandigarh Under Article 240 ED tells Supreme Court officers can approach top court under Article 32 if law and order is breached Modi Govt's Article 370 Explained | What inclusion in Article 240 would mean for Chandigarh Netanyahu shares article claiming Epstein worked for Israeli intelligence Wangchuk says Article 371 talks for Ladakh still ‘work in progress’ X to award $1 million to top article in push for long-form writing Removing Article 370 was a true tribute to Sardar Patel
Martha Mitchell was a flamboyant Washington DC socialite whose husband was embroiled in the Watergate scandal. Her shocking claims of a violent abduction and a "dirty business" were ridiculed as delusional – until they turned out to be true. Martha Mitchell was a character; everyone agreed on
1 days ago
From the academic year 2026–27, bilingual classes will be introduced in all government schools across 15 districts of the state. While the government had earlier announced that English would be introduced in LKG classes, a fresh directive now states that an Urdu-English bilingual medium will also
1 days ago
Trading scalpel for golf irons: Indian-origin golfer Manav Shah’s stirring journey to US OpenTrading scalpel for golf irons: Indian-origin golfer Manav Shah’s stirring journey to US Open Updated on: May 26, 2026 4:14 PM IST PTI Share via Copy link New Delhi
1 days ago
Pakistan’s Defence Minister Khawaja Asif has said that he was not in favour of Islamabad joining the Abraham Accords to normalise relations with Israel. Also read | Pakistan deploys jet squadron, thousands of troops to Saudi Arabia amid escalating Iran war tensionsPakistan’s Defence Minister
1 days ago
AIADMK MLA Esakki Subaya submitted his resignation today. He is the fourth MLA from the party to resign in two days. Subaya supported former ministers C Ve Shanmugam and S P Velumani. Three other AIADMK MLAs also resigned yesterday. They are expected to get tickets for upcoming byelections from the
1 days ago
Kimi Antonelli extended his lead in the drivers' championship after Mercedes team-mate George Russell retired from the Canadian Grand Prix. Ferrari's Lewis Hamilton finished second and Max Verstappen's Red Bull made up the top three. Russell was successful earlier in the weekend when he converted
1 days ago
Madhya Pradesh Chief Minister Mohan Yadav on Monday announced financial assistance of Rs 5 lakh each to the families of three persons who died in February 2003 during protests seeking to declare the Bhojshala-Kamal Maula mosque complex in Dhar district as a temple, The Hindu reported
1 days ago
2026 Honda City facelift on wishlist? Key genuine accessories you can buyThe 2026 Honda City facelift can be accessorised with a plethora of genuine accessories. Published on: May 26, 2026 1:40 PM IST By Mainak Das Share via Copy link Limited Time Deals on Popular cars Volvo XC90 ₹ 97
1 days ago
Lawyer seeks to register Cockroach Janta Party separately from US-based founderSudhir Jakhar, the lawyer calling himself the party’s national convener, submitted the application to the ECI secretary Updated on: May 26, 2026 1:57 PM IST By Harsh Yadav Share via Copy link A lawyer from Haryana’s
1 days ago
South Korean seven-piece BTS have won Artist of the Year at the American Music Awards (AMAs) for the second consecutive year, cementing their status as one of the world's biggest bands. The award, considered the ceremony's grand prize, is just the latest crown jewel for the so-called kings of K-pop
1 days ago
The ET Most Innovative AI Product Awards 2026 recognises the AI Platforms, Infrastructure & Developer Tools category. It highlights the technologies powering the next phase of enterprise AI from platforms and MLOps to observability and developer tools. These innovations are enabling scalable
1 days ago
Vedant Shrivastava posts correct CBSE answer sheet, alleges marks slashed for right answerClass 12 student Vedant Shrivastava has received his correct answer sheets after CBSE admitted to a mix-up with his Physics paper. Updated on: May 26, 2026 1:13 PM IST By Sanya Jain Share via Copy link Class
1 days ago
Assam Chief Minister Himanta Biswa Sarma announced plans to boost the state's economy to Rs 10 lakh crore by 2028. He stated the tabling of the Uniform Civil Code bill demonstrates the government's dedication to the rights of minority women. Sarma also noted the election results reflected public
1 days ago
Air India has rolled out an upgrade to its Maharaja Club loyalty programme, allowing members to earn and redeem Maharaja Points on Air India Express flights covering more than 55 destinations across South Asia, Southeast Asia, and West Asia. The move broadens the scope of the airline group’s
1 days ago
Hansal Mehta has long been recognised as one of India’s most emotionally observant storytellers. Whether through the raw realism of Shahid, the intimacy of Aligarh, the unsettling tension of Scam 1992 or the deeply human narratives that run across his body of work
1 days ago
Tech Tonic | Ferrari Luce, Sir Jony Ive, and a subversion of ethosFerrari Luce is trying to tell the carmakers of the world that cars don’t have to feel like driving a tablet. Published on: May 26, 2026 11:43 AM IST By Vishal Mathur Share via Copy link The first car from Sir Jonathan Paul Ive
1 days ago
SC stays Delhi HC ruling against barring law students over attendance shortageA bench of justices Vikram Nath and Sandeep Mehta passed the interim order while issuing notice on a petition filed by the Bar Council of India (BCI) against the November 2025 judgment of the Delhi HC Published on: May 26
1 days ago
Hema Malini’s blush pink saree for receiving Dharmendra’s Padma Vibhushan is all about elegance and simplicity. See picsVeteran actor Hema Malini looked graceful in a blush pink saree as she accepted late actor Dharmendra’s Padma Vibhushan at the 2026 ceremony in New Delhi
1 days ago
Bengaluru traffic police slaps auto driver over accident, viral video sparks outrageMany on social media have tagged Bengaluru Police, urging them to take a look into the matter where a cop allegedly slapped an auto driver. Published on: May 26
1 days ago
Israeli Finance Minister Bezalel Smotrich on Monday (May 25, 2026) called on Prime Minister Benjamin Netanyahu to resume bombing Beirut in response to increased explosive drone attacks by Hezbollah on Israeli troops and northern Israel towns. Mr
1 days ago
has reported a net profit of Rs 48.4 crore for FY26, its first full financial year after the completed its with , marking a turnaround from a Rs 216.7 crore loss in the previous year.Total income more than doubled to Rs 1,402.7 crore in FY26 from Rs 603.8 crore in FY25
1 days ago
Partnership, the firm cofounded by Indian entrepreneurs , Sanjeev Kumar and Ashish Kumar, has launched a dedicated frontier-tech investment platform, (Fundamentum Frontier Advisors), with Rs 3,000 crore to invest in artificial intelligence and deeptech startups.Of this, Rs 2
1 days ago
The admission process for IGNOU July 2026 session has commenced for Open and Distance Learning (ODL) and online programmes. Interested students can apply by visiting ignouadmission.samarth.edu.in. The Indira Gandhi National Open University has started the admission process for the July 2026
1 days ago
Editorial independence is core to our work. Some links may earn us a commission, without influencing our opinions.From instant coffee to incredible: The best easy-to-use brewers for a better morningGood coffee at home no longer needs cafe visits, as these coffee machines can handle espresso
1 days ago
5 crystals to bring luck and financial growthGemstones are tools to connect your goals with your actions and mindset. Here are five crystals that are often linked with luck and financial growth. Updated on: May 26, 2026 1:20 PM IST Edited by Kanakanjali Roy Share via Copy link While crystals are
1 days ago
The U.S. military said it carried out “self-defence” strikes in southern Iran, including on missile launch sites and boats placing mines, even as President Donald Trump said on social media that negotiations were “proceeding nicely”. The strikes were done “to protect our troops from
1 days ago
Wall Street is abuzz with next month’s expected blockbuster debut of Elon Musk’s rocket and satellite maker SpaceX, but few of the biggest IPOs in recent years have paid off for investors who bought in when the deals came to market. A Reuters analysis of the 50 IPOs with the highest
1 days ago
