Indian IT service providers face heightened competition from AI-native firms in the next three years, potentially eroding their revenue base unless they remain competitive and protect recurring businesses, according to a report by S&P Global Ratings.
Nasscom has warned that India's technology workforce risks becoming merely AI-reliant rather than truly AI-native if deep engineering expertise is not preserved. The industry body highlights that while many professionals adopt AI, only a fraction are AI-native, necessitating a shift in academic and industry approaches to foster foundational skills and independent problem-solving.
AI is no longer a tool only for software engineers and technology teams.
Karnataka Chief Minister D K Shivakumar announced the establishment of India's first government-driven Artificial Intelligence University and an AI Hub in Bengaluru. This initiative aims to position Karnataka as a global leader in responsible AI innovation, fostering talent, research, and collaboration. The state seeks to become an AI-native state, leveraging AI to improve governance and daily life across various sectors.
IT services giant Wipro has launched an Applied AI Centre of Excellence (CoE) in Bengaluru, focusing on Anthropic's Claude models. This initiative aims to accelerate enterprise AI adoption, train 10,000 experts, and integrate AI into core business workflows and Wipro's internal operations.
Cars24 has announced the launch of its AI Labs, backed by a USD 20 million investment, to foster AI innovation and support startups in the field.
'Hiring within IT services firms is going to be very specialised.'
The technology startup ecosystem in India attracted $7.2 billion in funding during the first half of calendar year 2026, marking a 12 per cent year-on-year (Y-o-Y) increase. However, even as funding increased, deal count fell sharply, according to a report by market intelligence platform Tracxn.
Indian IT services companies are set to significantly increase their acquisition spending to $6.5-7 billion this year, up from $5 billion last year, as they seek to boost revenue and capabilities in areas like Cloud, data, enterprise platforms, and AI amidst a challenging economic environment.
Flipkart has announced the appointment of Smita Ojha as Vice President of Engineering and Amit Sharma as Vice President of Program Management to scale its core technology and drive long-term value creation.
IT services giant Cognizant is embarking on a significant AI-led restructuring programme, Project Leap, involving an investment of up to $320 million, which will lead to workforce reductions across geographies and a strategic shift towards AI capabilities to boost productivity and margins.
Wipro has announced the launch of a dedicated AI-Native Business and Platforms unit, leading to a leadership shuffle with Nagendra Bandaru appointed as CEO and Kanwar Singh joining as President and Managing Partner of Technology Services GBL.
'Wipro's challenge is not lack of ideas. In fact, some of its recent structural moves are arguably bolder than peers.' 'The problem is proving it can operationalise these bets faster and more consistently.'
Wipro reported Q4FY26 IT services revenue of $2.6 billion, a modest 0.2 per cent Q-o-Q constant currency growth, with adjusted operating profit margin beating estimates at 17.2 per cent. The company announced a significant share buyback of ~15,000 crore, but faces near-term growth challenges, particularly in the BFSI segment, and has issued a soft Q1FY27 revenue guidance.
The Nifty IT index hit a more than nine-month low, trading at its weakest level since April 17, 2025.
Accel and Google's AI Futures Fund have announced the five startups selected for the 2026 Atoms AI Cohort, focusing on enterprise, voice, and industrial AI solutions, with each startup receiving significant investment and resources.
...compared with 153,000 in all of 2024.
'People are taking effort to train and adapt to current skills.' 'If that is not there, they are not useful to us.' 'They have to adapt to new technology, and what is important is learnability.'
'Employers increasingly want candidates who can take AI pilots from proof-of-concept to production-ready systems.' 'That requires governance, monitoring, and ROI measurement -- skills that go beyond coding and into business impact.'
Research and development (R&D) spending by BSE 100 companies has grown steadily, rising from 0.89 per cent of revenue in FY20 to 1.32 per cent in FY24, averaging around 1 per cent over the period in-between, according to data compiled from Bloomberg and company annual reports. Also, these companies more than doubled their R&D spending in absolute terms over these five years: From Rs 25,041 crore to Rs 63,072 crore. While this reflects a prioritisation of innovation, corporate R&D investment remains relatively conservative.
'The Indian developer community is one of the most vibrant communities.' 'Indian builders are incredibly passionate, curious, and excited to embrace new technologies.'
'We're already seeing signs of superhuman capability.'
'The country is a good test bed for enterprise adoption, but to scale rapidly, companies will need to look outside the country for customers.'
Asia's richest man Mukesh Ambani on Thursday said his oil-to-telecom-and-retail conglomerate is not seeking short-term profit but is in the business of creating wealth for the nation. Speaking at the company's annual shareholder meeting, he said all businesses of Reliance Industries Ltd continue to be key drivers of the Indian economy and have become a success story. "We are not in the business of pursuing short-term profit and hoarding wealth. "We are in the business of creating wealth for India," he said.
When AI is used to enhance operational efficiency, businesses can deliver the same product or service but with improved quality, faster, or even at a reduced cost
