ET World Leaders Forum: Software prowess puts India in a pole position for AI, says Nigel Vaz, CEO, Publicis Sapient

New Delhi: India can leverage its decades-long strength in software and technology services to gain advantage in the artificial intelligence race by focusing on using AI to transform businesses rather than pursuing competition immediately with the US and China in computing power and foundation models, said Nigel Vaz, CEO, Publicis Sapient.

The tech leader said India needs to invest in silicon, compute and foundational models, but its bigger near-term opportunity is in the application layer, where companies can generate returns from existing AI capabilities. "The question then becomes: what do you actually do with that capability?" Vaz told ET in an interview. He termed it as a two-speed strategy: developing basic infrastructure, and helping organisations apply AI throughout software development, operations and other functions. Vaz related the development of AI to the arrival of electricity, when increased power generation eventually spurred demand for new applications and appliances. He claimed that India's large base of technological workforce and services industry gives it an advantage in terms of applying AI at scale.

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Publicis Sapient, the digital business transformation unit of Publicis Groupe, is integrating AI into products like Slingshot, which speeds up software development and modernisation; Bodhi, which manages multiple AI agents across complex workflows; and Sustain, which can identify and resolve technology issues before users experience them. "These are examples of application-level value that India is extraordinarily well positioned to capture," said Vaz. He emphasised that the Indian government should focus on building the foundations needed for the private sector rather than attempting to direct the industry. "The government's role is to create the precursors that allow industry to scale," Vaz said, citing clean energy, silicon manufacturing, research and core technology capabilities as priorities for AI.

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On the impact of AI on the traditional labour-arbitrage model that has driven much of India's IT services industry so far, Vaz said the model will come under increasing pressure as AI changes how technology work is delivered. The model, based largely on performing similar work at lower cost from India, cannot remain the industry's primary proposition indefinitely, he said.

"AI gives us the opportunity to reimagine work entirely," Vaz said.

The transition could disrupt companies employing large numbers of people in repetitive work, but it could also create new roles as the industry changes, he said, comparing the shift with the transformation of IT services after the Y2K problem. "The question is the investment and the time that it's going to take because AI is creating unprecedented scale for a small number of people," he said.

Competition in technology will also become less predictable, with AI startups, hyperscalers, consulting firms, traditional services companies and model providers increasingly overlapping.

"AI startups tend to be strong on the technology side but weaker on the enterprise context, while established services companies have industry knowledge and client relationships, but may face conflicts between existing business models and what customers want," said Vaz.

In certain areas of the technology lifecycle, he expects companies to compete, and in others, to collaborate, which is different from past technology cycles.

Vaz anticipates software itself to evolve over the next five to seven years, with corporations buying collections of AI agents rather than fixed apps.