AI could leave engineering graduates with obsolete skills, warns Nasscom chief
Artificial intelligence could make it harder for fresh engineering graduates in India to find technology jobs, as companies increasingly use AI to handle tasks traditionally assigned to entry-level employees. Rajesh Nambiar, president of the National Association of Software and Services Companies (Nasscom), has warned that students could enter the job market with skills that are no longer relevant if India's education system fails to keep pace with the technology.
In an interview with Nikkei Asia, Nambiar said AI is already changing the kind of work companies expect employees to do. Tasks such as basic coding and software testing, which have traditionally provided entry-level opportunities for engineering graduates, are increasingly being automated. He said this could create difficulties for freshers until India's IT industry adjusts to the changing business environment.
"From a fresher's point of view, it is a concern, (and) I will not sugarcoat it any differently," Nambiar told Nikkei Asia. "If our education system is unable to make that transition very quickly, students will come out with skill sets which may be very obsolete already."
He believes India's computer science and engineering curriculum needs a major overhaul to prepare students for the jobs companies will increasingly offer. "The level of transformations required in the curriculum has never been this significant," he said.
India has a large number of students entering engineering colleges every year, with technology careers traditionally seen as a route to well-paying jobs. The country had 5,903 engineering and technology colleges in the financial year ending March 2026, with enrolments close to 2.6 million, according to official estimates. However, graduate unemployment remains a concern. Azim Premji University's estimates show that the number of unemployed graduates increased nearly fourfold to around 11 million between 2004 and 2023.
The government has started introducing AI education initiatives, including teaching the subject to children as young as eight. It has also launched an online repository of courses covering AI, data analytics and cybersecurity. According to the government, 1.3 million people have received course completion certificates through these programmes.AI is forcing India's IT industry to rethink its business model
The challenge for fresh graduates is part of a larger change underway in India's IT services industry. For years, software companies have earned a significant portion of their revenue by deploying large teams of employees to manage technology infrastructure and handle routine IT operations. AI tools are now taking over some of these tasks, putting pressure on the traditional business model.
Nambiar said companies will need to explore newer areas such as cybersecurity, AI consulting, and AI implementation and maintenance to make up for the decline in traditional IT services work. He also pointed out that clients are increasingly paying for the results delivered by a project rather than the number of employees assigned to it. The changing business environment is already affecting the country's largest IT companies. Tata Consultancy Services (TCS) reported sequential revenue growth of just 0.5 per cent in the July-September quarter, its weakest performance in three years. Infosys also lowered its revenue growth forecast for the financial year ending March 2027 to 1-2 per cent, against its earlier estimate of 1.5-3 per cent.
Nambiar described the current phase as a period of "rebalancing", which he expects to continue until new AI-related business makes up for the revenue lost from older services. There are some signs of growth in this area. TCS reported a 19 per cent rise in annualised AI revenue to $3.1 billion, while Infosys said its AI revenue grew 29 per cent quarter on quarter in the September quarter. He expects the transition to bring some difficulties for the industry but believes the long-term outlook remains positive. However, not every company may be able to adapt to the changes.
"There is very little doubt about (survival of) the industry, but (it's) more to do with the underlying companies," Nambiar said, adding that he expects 80-85 per cent of businesses to survive.
He also warned that companies comfortable with their traditional ways of working could find it difficult to keep up with AI. "You need to disrupt your own business, otherwise you're not going to get into the new world," he said.- Ends
Ankita Garg is a tech journalist with more than 9 years of experience. She is always curious about new gadgets and loves writing about them. When not writing, you will find her painting or sketching.
