Artificial intelligence (AI) will cause limited job losses while significantly boosting productivity and supporting India’s long-term growth trajectory, former HDFC Bank chief executive Aditya Puri said at the Mint India Investment Summit in Mumbai on Friday.
“You will lose some… but there’s no need to say the world is coming to an end… this will come out better,” said Puri, who was conferred the lifetime achievement award at the summit.
He pushed back against concerns of large-scale displacement from the adoption of AI, adding that the technology is already creating new roles across the value chain.
“This is just the raw material… somebody has to convert what was a possibility into reality,” he said, adding that this will create emerging demand for prompt engineers, context engineers and specialized data scientists.
Calling AI one of the biggest opportunities, Puri said its impact will be most visible in customer-facing sectors such as banking.
“AI can and should be used in a full role for efficiency and for profit,” he said, adding it can used for applications in credit assessment, marketing, fraud detection and operations. At the same time, he cautioned against overestimating the pace of change.
“It’s here to stay… but it’s not as if everything is going to be implemented overnight,” he said, adding there is too much negative hype on job losses.
On the macro front
Puri maintained that India’s structural growth story remains intact, backed by strong fundamentals. Despite external risks, India will remain the fastest-growing economy, he said.
“This war is a problem… I am not trying to say there is no problem with it,” he said, referring to the West Asia war. However, he expects the impact on India to be limited.
“Worst case scenario would be our GDP growth will come down to 6.2%, but we will grow faster, but other countries may grow by only 1%.”
India’s economy is likely to grow 5.9% in 2026, lower than the 6.5% estimated earlier this month, Goldman Sachs said in its report on Tuesday as it downgraded global growth forecast to reflect higher energy prices and an expected longer disruption of energy trade via the Strait of Hormuz.
Brent crude oil prices have shot up by over 50% since the US and Israel launched a war against Iran on 28 February. Currently, it is trading at around $110 per barrel. A surge in crude oil prices typically has a cascading effect on overall inflation.
On Thursday, Axis Bank’s chief economist Neelkanth Mishra warned the world could be staring at a recession within weeks if the war in West Asia doesn't ease by the middle of April. However, he said India’s medium-term growth trajectory remains intact, despite some immediate, near-term impact from the war.
“If by mid-April, the Strait of Hormuz is not opened fully, I think the world is headed into a recession,” he had said at the Mint India Investment Summit on Thursday, flagging the narrow window policymakers have to contain the fallout.
The immediate risk stems from energy disruptions and supply-chain breakdowns. India’s vulnerability stems from its reliance on imported energy.