AI Will 'Redefine, Not Replace' India's IT Services Industry: Anand Mahindra

Artificial intelligence (AI) is unlikely to diminish the role of India's IT services industry, but it will fundamentally change how the sector operates, Tech Mahindra Chairman Anand Mahindra said on Friday.

Speaking at the company's 39th Annual General Meeting (AGM), Mahindra addressed growing concerns that AI could reduce the relevance of IT services firms.

He argued that while AI is transforming enterprises, organisations will continue to depend on technology partners to integrate, govern and deploy AI securely across complex business environments.

"At the very outset, let me tackle the elephant in the room — which is the prediction that the rise of Artificial Intelligence will kill IT services in India. Every major technology cycle creates such anxieties. My answer however is clear: the role of IT services will not diminish. It will change, of course. And in many ways, it will become more important," he said.

Mahindra said AI is moving beyond being a productivity tool and becoming central to business operations, decision-making and customer engagement. However, he noted that deploying AI at enterprise scale remains challenging because organisations continue to operate legacy systems, fragmented data and complex regulatory frameworks.

Drawing a comparison with smartphones, he said AI models alone would not create business value. Instead, enterprises would increasingly differentiate themselves through their proprietary data, business workflows, institutional knowledge and domain expertise — what he described as an organisation's "alpha".

The chairman also said AI transformation extends beyond technology and requires changes in business processes, workforce capabilities and operating models, making trust and responsible implementation increasingly important for enterprises adopting AI.

Calls For India's Sovereign AI Capability

Mahindra also stressed that the next phase of AI development would require India to build indigenous capabilities rather than rely entirely on technologies developed overseas.

Referring to India's development of the PARAM supercomputer after being denied access to Cray systems in the 1980s, he said the same spirit should guide the country's AI ambitions.

"That very same instinct must now be brought to Sovereign AI: not isolation, not dependence, but indigenous capability, trusted collaboration, and the ability to build, adapt and govern critical AI systems on our own terms," he remarked.

According to Mahindra, AI adoption in enterprises should complement human expertise rather than replace it.

He said future organisations would combine human judgement with AI capabilities, adding that Tech Mahindra's Project Helix and AI-enabled Vector Squads are intended to support that approach.