By Sankalp Phartiyal | Updated on Jun 09, 2026 at 04:32 PM
Tata Consultancy Services Ltd., Asia’s largest outsourcer, will reduce hiring going ahead as it steps up the use of artificial intelligence agents, marking a pivotal shift in India’s labor-intensive outsourcing industry.
“The company will have an equal number of AI workers — we call them AI agents — as there are employees. If the company has half a million employees, the day is not far when the company will have half a million AI agents,” Tata Group Chairman Natarajan Chandrasekaran said at TCS’ annual general meeting Tuesday.
For decades, India’s $315-billion software services industry, led by TCS and smaller rival Infosys Ltd., thrived on labor arbitrage, transforming the country into the world’s backoffice. AI now threatens to upend that model, clouding career prospects for IT engineers — a dream job for millions of aspirational middle-class households.
Rapid technology changes have already begun showing effect at TCS, which last year cut 12,000 jobs. The company currently employs just under 600,000 people.
Asia’s largest outsourcer is now beginning to pivot toward high-margin businesses. It already has an agreement with OpenAI to build AI data centers and is nearing additional deals with other tech giants, Chief Executive Officer K. Krithivasan told Bloomberg News previously.
On Tuesday, Chandrasekaran, who previously served as TCS’ CEO for more than seven years, said AI will also create new jobs.
“Will it definitely lead to decrease in hiring — absolutely. That does not mean there are no future opportunities. Once the transition happens, the AI world will produce so much more opportunities, there will be new talent that will be required,” he said.
TCS AI revenue crossed an annualized $2.3 billion in the fiscal fourth quarter through March 2026. By 2028 to 2030, all of TCS’ revenue will have an AI component, said Chandrasekaran.