AI productivity gains rattle Indian IT services but analysts see transition

The breakneck pace of artificial intelligence-led productivity gains is unsettling India’s traditional IT service industry, but market observers say fears of a structural collapse may be overstated.

Stocks of IT behemoths followed a global rout in tech stocks, with the key catalysts being US firm Anthropic pushing AI into executing structured professional tasks and Palantir highlighting in its earnings call how it is upending pay-per-seat software as well as third-party software with its own AI offerings.