25 February 2026 Punjab Khabarnama Bureau : A new artificial intelligence–focused research report has triggered fresh anxiety across India’s information technology sector, warning of deep structural disruption for traditional IT services companies. The report suggests that rapid advances in generative AI, automation, and autonomous software development could significantly erode revenue streams and employment models at major Indian IT firms such as Infosys, Tata Consultancy Services, and Wipro over the next few years.
According to the report, global enterprises are increasingly adopting AI-driven tools that can write code, test software, manage infrastructure, and even handle customer support with minimal human intervention. Tasks that once required large teams of engineers are now being completed faster and cheaper by AI-powered platforms. This shift, the report argues, directly threatens the labour-intensive outsourcing model that has long been the backbone of India’s $250-billion IT industry.
The study paints a sobering picture for large-cap IT firms that rely heavily on application development, maintenance, and support services. As clients in the US and Europe push to cut costs and improve efficiency, many are exploring AI-led solutions that reduce dependency on external vendors. The report warns that if Indian IT companies fail to rapidly reinvent their offerings, they could face revenue pressure, margin compression, and slower growth than historical averages.
One of the most striking predictions relates to workforce impact. The report estimates that a significant portion of entry-level and mid-level IT roles could become redundant as AI systems mature. Routine coding, debugging, and testing jobs are seen as particularly vulnerable. This has raised concerns about hiring slowdowns, reduced fresher intake, and large-scale reskilling requirements across the sector.
However, industry leaders argue that the “AI doomsday” narrative may be overstated. Executives from major IT companies have repeatedly said that AI should be viewed as an opportunity rather than a threat. They maintain that while automation will eliminate some roles, it will also create demand for new skills in AI engineering, data science, cybersecurity, cloud architecture, and digital transformation consulting.
Infosys, TCS, and Wipro have all announced major investments in AI platforms, internal training programmes, and partnerships with global technology providers. These companies are positioning themselves as strategic partners who can help clients integrate AI responsibly into their businesses, rather than simply replacing human labour. The report, however, cautions that the transition will not be smooth and that near-term disruptions are inevitable.
Market sentiment has already reflected these fears. Analysts note that IT stocks have seen increased volatility amid concerns about pricing pressure and uncertain demand. Some brokerages have flagged the risk of valuation derating if growth slows sharply due to faster-than-expected AI adoption by clients. Investors are closely watching how quickly Indian IT firms can move up the value chain and monetise AI-led services.
The report also highlights a broader geopolitical and economic angle. As Western governments push for domestic technology capabilities and AI sovereignty, outsourcing-heavy models could face additional challenges. At the same time, competition from global consulting firms and product-based software companies adopting AI at scale could further squeeze Indian IT players.
Despite the warnings, experts agree that India’s IT sector is unlikely to collapse. Instead, it is expected to undergo a painful but necessary transformation. Companies that invest aggressively in innovation, reskilling, and high-value consulting are likely to survive and even thrive in an AI-driven world. Those that cling to legacy models, the report warns, risk being left behind.
As artificial intelligence reshapes the global technology landscape, the coming years will be critical for Infosys, TCS, Wipro, and their peers. The challenge lies not in resisting AI, but in redefining their role in an industry where machines are increasingly capable of doing what humans once did best.
Summary
An AI-focused report warns that rapid automation could disrupt India’s IT sector, threatening traditional outsourcing models at Infosys, TCS, and Wipro unless companies swiftly adapt and reskill.