Sridhar Vembu, Founder and Chief Scientist of Zoho, has expressed strong optimism about India’s IT services industry as it rapidly pivots toward artificial intelligence-driven services.

In a recent post on X (formerly Twitter), Vembu shared insights from a conversation with a senior IT services executive with over two decades of industry experience. According to Vembu, the executive now leads a fast-growing team helping Western financial institutions deploy AI solutions, with demand rising sharply.

“Business is booming and he has been asked to expand his team rapidly,” Vembu wrote, underscoring the surge in AI consulting and implementation work.

Indian IT Services Enter the AI Era

Vembu highlighted the Indian IT industry’s ability to adapt quickly as its biggest strength.

“I am very happy to see India’s IT services industry adapting to the new era rapidly. It is that adaptability that is the key,” he said.

While cautioning that the transformation is still in its early stages, Vembu added that AI could emerge as a major growth engine for India, particularly for services companies that already possess deep global exposure and execution capabilities.

AI as a Tool, Not a Replacement

Vembu has previously spoken about Zoho’s own approach to AI adoption. He has noted that developers at Zoho are encouraged to use AI tools for base-level coding, but with a crucial caveat: human accountability remains essential.

According to Vembu, engineers must fully understand, test, and take responsibility for any AI-generated code before it is deployed in production systems.

This philosophy, he suggests, reflects how AI should be integrated across the broader IT services industry — as a productivity enhancer rather than a wholesale replacement for human expertise.

Domain Knowledge Gives India an Edge

The discussion on X drew widespread agreement from industry observers, many of whom pointed out that Indian IT firms have accumulated decades of domain knowledge across industries such as banking, finance, healthcare, and manufacturing.

One user commented that years of working behind the scenes for global enterprises have positioned Indian professionals well to apply AI in real-world business contexts. Vembu agreed, responding:

“The domain experience in IT services is amazing.”

This combination of technical skill and process understanding could give Indian IT companies a competitive edge as enterprises move from AI experimentation to large-scale deployment.

Balancing Automation and Jobs

The conversation also addressed concerns around job displacement, particularly in traditional application development and maintenance roles.

Vembu acknowledged that some roles may decline but argued that new AI-enablement jobs are likely to offset losses.

“Traditional application development and maintenance would likely lose jobs, offset by AI enablement jobs because best use of AI tools requires domain expertise which IT services firms have gained. On balance, it may work out well,” he said.

Industry Momentum Builds

India’s IT sector — which generates hundreds of billions of dollars in annual revenue and employs millions — has been accelerating investments in:

• AI and generative AI training programs

• Dedicated AI labs and innovation centers

• Strategic partnerships with global cloud and AI providers

Major players such as Tata Consultancy Services, Infosys, Wipro, and HCLTech have recently reported growing pipelines of AI-led deals and workforce upskilling initiatives.

The Bigger Picture

Vembu’s comments reflect a broader shift underway in India’s technology ecosystem. While AI poses disruption risks, it also opens up new service lines, higher-value consulting work, and global relevance for Indian IT firms.

As enterprises worldwide look for partners who can combine AI tools with real business understanding, India’s IT services industry may be uniquely positioned to lead the next phase of global digital transformation.