CEA Urges Industry To Invest In Skilling, Innovation To Counter AI Challenges
The CEA also said that the government has done its part by announcing several measures in the budget to support Global Capability Centres (GCCs)
New Delhi: Chief Economic Adviser (CEA) V Anantha Nageswaran on Thursday urged industry to invest in skilling, capability development and innovation to address the challenges posed by artificial intelligence (AI). “AI does not build, deploy, or govern itself. Someone has to design these systems, train them, test them, correct them, and hold them to account. Someone has to decide where he should be used and where he must not be used,” he said at a CII event here.
The CEA also said that the government has done its part by announcing several measures in the budget to support Global Capability Centres (GCCs). He also highlighted the role of government-industry collaboration, saying that the Union Budget has addressed a long-pending industry demand by simplifying and expanding the transfer pricing safe harbour regime for GCCs.
Observing that AI has exposed the old model, Nageswaran also said that it is likely to displace routine, repetitive and rule-based tasks, and it would be unrealistic to deny the risks posed to business models built solely around low-cost execution. “The revised framework provides a uniform margin, significantly higher thresholds and faster, more predictable approvals over a multi-year period, improving tax certainty for such centres,” he said.
The government has also launched a national framework to encourage the expansion of GCCs beyond the six major metropolitan cities into tier-II and tier-III locations. “This is not only an economic goal; it is a matter of fairness. The opportunity should not sit in a few metros alone,” Nageswaran said, adding that at the same time, the government policy alone cannot secure India's leadership in the sector.
The CEA has identified skilling as one of India’s biggest challenges, noting that while the country produces a large number of graduates every year, too few are industry-ready when they enter the workforce. “The government can build the runway, but it cannot fly the plane. The move from cost to capability, from execution to innovation, has to be made by firms and by people,” he said.
