AI Could Drive Next Growth Phase for India's IT Sector Despite Short-Term Risks

India's $280-billion IT services industry faces potential disruption from AI in the short term, but experts see it as a major long-term growth engine. According to Baroda BNP Paribas Mutual Fund, while traditional revenue streams might be challenged, new opportunities are emerging in data engineering, cybersecurity, and cloud integration. The fund remains optimistic about financial services and healthcare sectors over the next three to five years, suggesting that AI will eventually create more value than it destroys for the IT sector.
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