India can harness the power of artificial intelligence as it has an advantage over other countries due to vibrant startup ecosystem, strong IT services, say experts
Jayadipta Chatterji Mehta
A strong tech startup story and IT prowess give India an edge over others in artificial intelligence (AI) adoption.
In the second part of our series on AI, members of The Economic Times India Leadership Council, ETILC’s core group on technology weigh in on India’s advantages as a market leader in IT services. “We believe India has a major advantage over other countries due to its vibrant tech-related startup ecosystem, strong IT services, and an offshoring industry, to harness the power of AI,” they say. The members include Kaushal Sarda, CEO, Kuliza Technologies; Dilipkumar Khandelwal, MD, executive VP, SAP Labs India; Anil Valluri, CEO, India and SAARC, NetApp; AS Rajgopal, MD, NextGen; Piyush Sinha, deputy MD, NEC Technologies; Anuj Gupta, CEO, Hitachi Systems Micro Clinic, and Vikas Gupta, CEO and CTO, GreyMatter Software Services.
For artificial intelligence and machine learning algorithms to run on big data, Indian companies require technology that will digitise and store data. Industry is now increasingly adopting this infrastructure. Since legacy systems are slow to change, they are the laggards. But nimble-footed startups are finding an opportunity to build new AI and ML technology like chatbots for ecommerce and online banking companies. Challenged by the lack of an addressable market within the country, B2B companies in the consumer space had until a few years ago found their market in the USA. They are back and witnessing a surge in investor interest. Research company YS Research feels 2019 may close as the year of the B2B unicorn (a privately-held startup company valued at over $1 billion).
TECH STARTUP FUNDING
Tech startup funding in H1 2019 is up 9% YoY to $4.9 billion. The average deal size is $12.8 million up 12% YoY, and the total number of deals is 381. The fintech sector saw the maximum deals; while transportation and logistics raised the maximum funding, with the highest average ticket size, says YS Research.
Many big technology companies have set up accelerators for startups like the SAP Startup Studio. The country is the third largest startup economy after China and the USA, across sectors including FMCG, food, banking, healthcare, diagnostics, transportation, and logistics.
THE SHARED ECONOMY
Heralding the fourth industrial revolution, technology is disrupting the core of existing businesses and the lives of people. The convenience and leisure that technology provides consumers have made industry adapt accordingly. It is a bonus for Indian business, since over 60% of the country’s GDP is formed by services. The new technology favours a shared model of business bringing buyers, sellers, and assets, all on the same scalable technology platform. The platform model is service-oriented.
The model is flexible, allowing different verticals to exist together. For instance, a health company is also a platform for a large sports company. It is also accommodating, as one member explains. He built a financial software platform to cater to an expanding middle class population, which is expected to be 4.5 billion people over the next two to three decades, across the emerging markets of Asia and Africa.
To build efficiency in his business, his platform uses AI on digitised and automated customer data to assess a loan seeker. He can make an accurate loan assessment for a ₹5 lakh loan, and disburse the full amount in an automated fashion efficiently, rather than involving people to physically collect and assess the relevant documents of the loan seeker, and then disburse the money. The more automated the business is, more efficient it will be with AI applications, he adds.
IT SERVICES’ ADVANTAGE
The IT industry is poised to take advantage of the new AI technologies. It can now build the world’s best business process automation and BPO AI applications. Its wide, lowcost services include customer service operations using AI chatbots; routing, and directing customers to support resources. In call centre operations, it can use AI in automating voice and conversation services, routing calls, providing analytics, and feedback on call performance.
AI can also be used in data entry, data management, and quality assurance workflows, HR and payment processing workflows. And now it can also leverage its BPO and backoffice expertise to develop a high margin product industry using AI. If this happens it will be a first for India. The National Association for Software and Services Company(Nasscom), is promoting product development activity and a support system for it.
SKILLING UP FOR THE NEW ERA
Skill is the new currency, in the current tech era, and India, too, is actively undertaking skilling and reskilling programmes for its workforce. An interim MIT taskforce report on the Work of the Future, is one of the more recent ones to assert that technology may destroy jobs in the short run, but it creates new and better jobs in the longer term.
However, it holds that while the job losses will not be in the immediate future, there is concern about the impact of technology on the labour market. In recent decades, technology has contributed to the polarisation of employment and new tech can exacerbate this situation. A critical challenge is not necessarily a lack of jobs, but the low quality of many jobs and the resulting lack of viable careers for many people, particularly workers without college degrees.
The US must, therefore, prepare policy responses, “if Americans are to build better careers and share prosperity as technological changes occur”.
At risk of such technological changes is our young workforce. By 2020, India will be the youngest country in the world with a median age of 29 years, compared to 37 years in China. Currently, nearly twothirds of Indians are below 35 years and almost half below 25. Of the required AI skills, data analysts and engineers are being adequately trained in enough numbers. However, in high demand are data scientists and domain experts, for their knowledge of ML applicability in businesses. But both these are few in number and there is need for more.
The IT/ITeS industry is at the forefront of the ongoing talent skilling and reskilling initiatives. The programmes are concerted initiatives of the government, industry, and the academia. Run on AI themselves, the more prominent educational programmes are live sessions, including Nasscom’s FutureSkills on new technologies.
Its participants are member companies and it has tied up with academia to offer its courses. The government has several skilling and reskilling programmes, while companies have taken the lead in building their workforces both on their own and in partnership with the government and the academia. The goal is to make India the global hub for digital talent.
Among the prominent AI applications are video analytics, facial recognition, and natural language processing. Facial recognition technology is the surveillance system in every office, and it can have up to 54 uses, if not more, including marking attendance to resolve safety-related issues.
With 22 national languages, Indians form the ideal testing ground for building a neural network for natural language processing. AI systems can understand speech, translate it into text and offer feedback, or register a person, through chatbots and assistants.