India's showpiece software industry is facing a moment of reckoning.
The country's biggest private sector employer Tata Consultancy Services (TCS) - also its largest IT services company - has announced it will cut more than 12,000 jobs at middle and senior management levels. This will reduce the firm's workforce by 2%.
The Mumbai-headquartered software behemoth employs over half-a-million IT workers and is considered a bellwether for business sentiment across India's $283bn software industry. It forms the backbone of formal, white-collar employment in the country.
The decision, TCS says, was taken to make the company "future ready" as it invests in new areas and deploys artificial intelligence at scale amid seismic disruptions in its traditional business model.
Companies like TCS have, for decades, relied on cheap skilled labour to produce software for global clients at lower costs, but this has been upended by AI automating tasks and clients demanding more innovative solutions, rather than just cost savings on manpower.
