India AI Impact Summit: Vinod Khosla warns AI could completely wipe out India’s IT outsourcing industry
The warning comes as India's IT giants, long the backbone of the country's economic growth, face mounting pressure from AI-driven automation.
- Feb 17, 2026,
- Updated Feb 17, 2026 7:57 PM IST
Venture capitalist Vinod Khosla has issued a stark warning to India's technology industry, saying artificial intelligence poses an existential threat to the country's IT services and outsourcing sector.
Speaking at the India AI Impact Summit 2026, Khosla said IT services and business process outsourcing firms could "almost completely disappear" within the next five years, with the outsourcing sector potentially "gone by 2030."
The warning comes as India's IT giants, long the backbone of the country's economic growth, face mounting pressure from AI-driven automation. Khosla argued that the industry has been slow to grasp the severity of the threat. "Many in India still do not believe that AI will significantly impact the IT sector," he said, cautioning that "rapid advances will disrupt industries that have long driven the country's economic growth."
Khosla also warned that the disruption extends beyond traditional outsourcing roles. "Artificial intelligence could eliminate large parts of white-collar employment," he said.
Rather than relying on foreign AI platforms to navigate this shift, Khosla urged Indian IT firms and the government to invest in homegrown capabilities. "Countries should develop their own AI systems, especially for sensitive areas like cybersecurity and defence, rather than depend on foreign models," he said.
Khosla also criticised long careers at large corporations, saying working 15 to 20 years at a single company could reduce adaptability in a fast-changing environment.
Venture capitalist Vinod Khosla has issued a stark warning to India's technology industry, saying artificial intelligence poses an existential threat to the country's IT services and outsourcing sector.
Speaking at the India AI Impact Summit 2026, Khosla said IT services and business process outsourcing firms could "almost completely disappear" within the next five years, with the outsourcing sector potentially "gone by 2030."
The warning comes as India's IT giants, long the backbone of the country's economic growth, face mounting pressure from AI-driven automation. Khosla argued that the industry has been slow to grasp the severity of the threat. "Many in India still do not believe that AI will significantly impact the IT sector," he said, cautioning that "rapid advances will disrupt industries that have long driven the country's economic growth."
Khosla also warned that the disruption extends beyond traditional outsourcing roles. "Artificial intelligence could eliminate large parts of white-collar employment," he said.
Rather than relying on foreign AI platforms to navigate this shift, Khosla urged Indian IT firms and the government to invest in homegrown capabilities. "Countries should develop their own AI systems, especially for sensitive areas like cybersecurity and defence, rather than depend on foreign models," he said.
Khosla also criticised long careers at large corporations, saying working 15 to 20 years at a single company could reduce adaptability in a fast-changing environment.