India’s information technology sector is rapidly transitioning toward an AI-driven services model, supported by close coordination between industry, academia, and the government, Union Minister for Electronics and IT Ashwini Vaishnaw said on Saturday.
Addressing the evolving role of technology services, the minister highlighted artificial intelligence as a defining opportunity for India to build and deliver next-generation services for global markets. He pointed to the growing role of Global Capability Centers (GCCs) in enabling AI-based solutions for international shipping companies, retail firms, and other global enterprises, while opening up new avenues for Indian engineering talent.
Vaishnaw said the government’s sustained focus on strengthening IT services has led to a sharp rise in GCC investments. “At the last count, more than 2,000 GCCs have already come to India, which is far more than in traditional IT services,” he noted.
He also drew attention to recent Union Budget announcements that include major reforms aimed at boosting data center infrastructure to support the fast-paced evolution of artificial intelligence. Emphasizing the sector’s transformation, he said, “Indian IT is moving from the old model to a new AI-based services model. Over the past one and a half years, we have had extensive discussions with the IT industry on the changes happening globally,” he said during a press conference.
Describing AI as a turning point for technology, Vaishnaw called it a landmark shift for the software ecosystem. “AI is being called the fifth industrial revolution, and it is bringing significant changes to the software sector,” he said.
He added that IT, software, and technology companies are redefining their global role by delivering AI-based services at scale. Referring to the layered structure of AI systems, he said, “In the five-layer architecture of AI, data centers provide the core infrastructure. With sufficient data centers, we can deliver AI services globally,” he said.
The minister clarified that domestic and foreign investors will receive equal treatment on tax benefits related to data centers. He stressed that the government has worked closely with industry stakeholders over the past one and a half years to ensure India benefits from the AI transition while safeguarding domestic interests. “The industry has worked meticulously with the government on this transition,” he said.
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