AI's impact on IT sector could be bigger than tariffs
Nilesh Shah, MD of Kotak Mahindra AMC, thinks AI could shake up India's IT sector more than tariffs ever could—possibly affecting jobs and spending habits.
Still, he says it's too early to panic about AI's impact.
No IT contracts lost due to AI yet
Shah points out that no IT clients have dropped contracts because of AI yet.
He reminds us that Indian IT firms have tackled big tech shifts before—like Y2K and the move to cloud—and most work still relies on people skills like design and client communication, not just coding.
India should selectively adopt AI
Shah says India should be selective in its AI adoption, focusing on areas of strength rather than trying to compete head-on with global tech giants.
On the market front, he expects things to bounce back by March 2026 after recent labor code changes hit earnings.
Banking, cement, and telecom are set for strong growth—but investors might need to get used to more moderate returns.