Davos 2026: Wipro CEO Srini Pallia says AI is driving a new IT services boom
According to Pallia, companies are no longer just "testing the waters" with AI. Instead, they are moving from small proof-of-concept (PoC) projects to large-scale, enterprise-wide deployments.
- Jan 21, 2026,
- Updated Jan 21, 2026 12:09 PM IST
Wipro's Chief Executive Officer, Srini Pallia, has expressed strong optimism regarding the future of the IT services industry, citing a massive surge in demand driven by AI.
Speaking at the World Economic Forum (WEF) in Davos, Pallia revealed that the industry is witnessing a significant shift. While 2025 was a year of experimentation and small-scale trials, 2026 is becoming the year of "accountability" and full-scale implementation.
Deployment-focused approach
According to Pallia, companies are no longer just "testing the waters" with AI. Instead, they are moving from small proof-of-concept (PoC) projects to large-scale, enterprise-wide deployments. This transition is creating a robust pipeline of new contracts for Indian software exporters, who are competing for a mix of "mega-deals" and smaller, more specialised AI projects.
"For our clients, 2025 was more about deploying AI, PoCs, and bringing productivity benefits. That's dramatically changing in 2026 because the boards and the CEOs are asking them where the return on investment is," Pallia said.
The Wipro boss acknowledged that AI is changing the economics of the IT sector. AI-assisted software development is expected to reduce coding and testing costs by around 25%. While this creates pricing pressure, Pallia argues it will ultimately lead to a higher volume of work as clients use the savings to fund even more digital transformation projects.
"AI-assisted software development will cost about 25% less, with significant productivity gains in coding and testing", he said. That will translate to "new and more projects, (and is) why IT budgets are not going to shrink in the long run," he added.
Despite a difficult period in recent years where global firms cut back on technology spending due to economic uncertainty, Wipro sees the current AI trend as a stabilising force.
The company previously committed $1 billion in 2023 to bolster its AI capabilities and is now focusing on "agentic AI" and consulting-led services to help global clients modernise their core systems.
Wipro's Chief Executive Officer, Srini Pallia, has expressed strong optimism regarding the future of the IT services industry, citing a massive surge in demand driven by AI.
Speaking at the World Economic Forum (WEF) in Davos, Pallia revealed that the industry is witnessing a significant shift. While 2025 was a year of experimentation and small-scale trials, 2026 is becoming the year of "accountability" and full-scale implementation.
Deployment-focused approach
According to Pallia, companies are no longer just "testing the waters" with AI. Instead, they are moving from small proof-of-concept (PoC) projects to large-scale, enterprise-wide deployments. This transition is creating a robust pipeline of new contracts for Indian software exporters, who are competing for a mix of "mega-deals" and smaller, more specialised AI projects.
"For our clients, 2025 was more about deploying AI, PoCs, and bringing productivity benefits. That's dramatically changing in 2026 because the boards and the CEOs are asking them where the return on investment is," Pallia said.
The Wipro boss acknowledged that AI is changing the economics of the IT sector. AI-assisted software development is expected to reduce coding and testing costs by around 25%. While this creates pricing pressure, Pallia argues it will ultimately lead to a higher volume of work as clients use the savings to fund even more digital transformation projects.
"AI-assisted software development will cost about 25% less, with significant productivity gains in coding and testing", he said. That will translate to "new and more projects, (and is) why IT budgets are not going to shrink in the long run," he added.
Despite a difficult period in recent years where global firms cut back on technology spending due to economic uncertainty, Wipro sees the current AI trend as a stabilising force.
The company previously committed $1 billion in 2023 to bolster its AI capabilities and is now focusing on "agentic AI" and consulting-led services to help global clients modernise their core systems.