Use AI to raise productivity, not reduce jobs: Assocham president

As India prepares for the Budget 2026-27, the president of the Associated Chambers of Commerce and Industry of India (ASSOCHAM), Nirmal K Minda, has emphasized the need for a balanced approach towards economic reforms. Highlighting the recent positive impacts of goods and services tax (GST) and income tax reforms on consumer spending, Minda advocates that the upcoming budget should focus on stimulating consumption demand, supporting micro, small, and medium enterprises (MSMEs), and implementing gradual wage increases. These measures are seen as essential to sustaining economic growth and improving the purchasing power of the population.

A key aspect of Minda's message is the role of artificial intelligence (AI) in the economy. He stresses that while AI can significantly enhance productivity, it should not come at the expense of employment. The integration of AI technologies must be managed carefully to ensure that job losses are minimized, and workers are reskilled to adapt to new roles created by technological advancements. This approach aims to balance technological progress with social stability.

The MSME sector, a critical component of India's economy, requires targeted support to thrive in a competitive environment. Minda suggests that the government should introduce policies that facilitate easier access to credit, reduce compliance burdens, and promote innovation within MSMEs. Strengthening this sector will not only boost employment but also contribute to increased domestic production and export potential.

Gradual wage hikes are another priority highlighted by the ASSOCHAM president. Incremental increases in wages can help improve living standards and drive consumption, which in turn fuels economic growth. However, these hikes need to be balanced with productivity gains to maintain competitiveness and avoid inflationary pressures.

Overall, Minda's recommendations for the Budget 2026-27 reflect a comprehensive strategy to foster inclusive growth. By prioritizing consumption demand, supporting MSMEs, and leveraging AI responsibly, the government can create a resilient economy that benefits all stakeholders. These measures are particularly important in the context of a rapidly evolving global economic landscape where technological disruption and shifting market dynamics pose both challenges and opportunities.

In conclusion, the upcoming budget should not only focus on fiscal consolidation but also on policies that promote sustainable growth and job creation. The emphasis on using AI to augment productivity without reducing employment underscores the importance of human-centric technological adoption. With careful planning and implementation, India can harness the benefits of AI and other reforms to build a robust and equitable economy.