India risks losing demographic dividend without urgent skilling, warns Chief Economic Adviser

India Risks Its Demographic Edge Without Skilling, Official Says

India risks squandering its demographic dividend and widening inequality unless it moves swiftly on skilling and education, a top finance ministry official said. The world's most populous nation needs to create at least eight million jobs annually until 2030 to cater to a rapidly growing workforce and if artificial intelligence outpaces skilling of workforce, the nation risks losing out benefits of a young working age population, Chief Economic Adviser V. Anantha Nageswaran said on Monday at the AI summit in New Delhi. "We risk widening inequality at precisely the moment of greatest change." He said the nation needs to simplify rules in labor-intensive sectors as only a small proportion of India's over 1.4 billion people -- just 4.4% -- are formally skilled, according to the economic survey 2023-24, despite various government measures. Deployment of AI needs to be calibrated else it would create "unavoidable social and economic instability," he added. Prime Minister Narendra Modi's ambition to turn India into a developed nation by 2047 will require sustained annual growth of at least 8%, alongside a rapid expansion of infrastructure and job creation to meet that goal. The window for job creation is finite as over the next 15 years, India's labor force is set to expand, then level off and begin to age, putting a clock on the nation's chance to cash in on its demographic dividend. For advanced economies facing demographic decline, AI can serve as a supplement but "for India it is a stress test of our state capacity," he said. "With foresight, institutional disciple and relentless execution, India can become the first large society to demonstrate that human abundance and machine intelligence can reinforce and not undermine each other," he said, adding it requires urgency, political will and state capacity. India needs to reform education and impart foundational skills to align artificial intelligence with increasing employability. "For India it isn't a debate about future of work, it is a decision about the future of growth, social stability and cohesion. We must act and act now."

India risks losing demographic edge without skills: CEA V. Anantha Nageswaran at AI Impact Summit

India risks squandering its demographic dividend and widening inequality unless it moves swiftly on skilling and education. The world's most populous nation needs to create at least eight million jobs annually until 2030 to cater to a rapidly growing workforce and if artificial intelligence outpaces skilling of workforce, the nation risks losing out benefits of a young working age population, Chief Economic Adviser V. Anantha Nageswaran said on Monday at the AI summit in New Delhi. "We risk widening inequality at precisely the moment of greatest change." He said the nation needs to simplify rules in labor-intensive sectors as only a small proportion of India's over 1.4 billion people, just 4.4%, are formally skilled, according to the economic survey 2023-24, despite various government measures. Deployment of AI needs to be calibrated else it would create "unavoidable social and economic instability," he added. Prime Minister Narendra Modi's ambition to turn India into a developed nation by 2047 will require sustained annual growth of at least 8%, alongside a rapid expansion of infrastructure and job creation to meet that goal. The window for job creation is finite as over the next 15 years, India's labor force is set to expand, then level off and begin to age, putting a clock on the nation's chance to cash in on its demographic dividend. For advanced economies facing demographic decline, AI can serve as a supplement but "for India it is a stress test of our state capacity," he said. "With foresight, institutional disciple and relentless execution, India can become the first large society to demonstrate that human abundance and machine intelligence can reinforce and not undermine each other," he said, adding it requires urgency, political will and state capacity. India needs to reform education and impart foundational skills to align artificial intelligence with increasing employability. "For India it isn't a debate about future of work, it is a decision about the future of growth, social stability and cohesion. We must act and act now." He added, "With foresight, institutional discipline, and relentless execution, India can become the first large society to demonstrate that human abundance and machine intelligence can reinforce and not undermine each other," Nageswaran highlighted when speaking at the Future of Employability and AI session at the event. Asserting that the outcome of artificial intelligence will not be "accidental", Nageswaran said achieving this vision demands strong state capacity and a clear national strategy to drive the required transformation. "This is not the task of the government alone; it must be a Team India effort, bringing together policymakers, industry, educators, and the society at large," he said. The CEA stated that India's demographic dividend is both a "promise and a warning," and called for urgent reforms to prevent an opportunity from becoming a "long-term liability." He emphasised that while millions of jobs are created annually, a significant skill gap persists. Addressing the summit virtually, the CEA said, "I hope this speech does trigger some truthful, concrete, and immediate action at all levels of society." The summit, which will go on till February 20, seeks to advance the use of AI in ways that drive inclusive economic growth, social development, and innovation that serves people while safeguarding the planet. With inputs from Bloomberg

India can lead the world by aligning AI-led transformation with mass employability: CEA Nageswaran

Chief Economic Advisor V Anantha Nageswaran warns that AI's impact will depend on deliberate policy choices and must align with mass employability. At the India AI Impact Summit 2026, he called for urgent structural reforms, large-scale skilling, and stronger foundational education to address the skill gap and secure inclusive growth and stability. India can lead the world by aligning AI adoption with mass employability through bold education reforms, chief economic advisor V Anantha Nageswaran said on Monday at the AI Impact Summit 2026. "With foresight, institutional discipline, and relentless execution, India can become the first large society to demonstrate that human abundance and machine intelligence can reinforce and not undermine each other," Nageswaran highlighted when speaking at the Future of Employability and AI session at the event. Asserting that the outcome of artificial intelligence will not be "accidental", Nageswaran said achieving this vision demands strong state capacity and a clear national strategy to drive the required transformation. "This is not the task of the government alone; it must be a Team India effort, bringing together policymakers, industry, educators, and the society at large," he said. The CEA stated that India's demographic dividend is both a "promise and a warning," and called for urgent reforms to prevent an opportunity from becoming a "long-term liability." He emphasised that while millions of jobs are created annually, a significant skill gap persists. "Every year of delay compounds the pressure and narrows our options. While millions of jobs are created annually, only a small proportion of our young workforce is absorbed into productive employment due to gaps in skills and training. This is not a cyclical challenge -- it is a structural vulnerability," Nageswaran explained. To mitigate this, he urged a decisive shift in policy focus . "Addressing it requires urgent investment in large-scale skilling, strengthening foundational education, scaling high-quality training programmes, and removing regulatory bottlenecks." Stressing the urgency of the situation, the CEA clarified that this is not merely a debate about the future of work, but a "decision about the future of growth, social stability, and cohesion." Addressing the summit virtually, the CEA said, "I hope this speech does trigger some truthful, concrete, and immediate action at all levels of society." The summit, which will go on till February 20, seeks to advance the use of AI in ways that drive inclusive economic growth, social development, and innovation that serves people while safeguarding the planet.