AI and the progress paradox
With the advent of Artificial Intelligence (AI) as the harbinger of technological reformation, the world is set to be reshaped. An advanced restructuring encompassing all arenas - from finance, manufacturing, healthcare, services and education — has already taken off. The recently held India AI Impact Summit 2026 starkly reflected India’s ambition to be a global AI hub. The event brought together world leaders, policymakers, researchers and innovators from across the globe to discuss and derive the potential benefits of AI and also the unavoidable need for inclusive AI development.
While every economy is ready to reap the benefits AI offers in terms of promising productivity and innovation, there is also a flip side. AI poses a paradox of serious long-run challenges in terms of negative externalities. There is a grave threat to the future course of human development and the widening of the economic and digital divide among nations. Human brains adapt to environmental changes, and therefore human traits of curiosity, ideas and focus are indispensable to critical and analytical minds. In an AI-driven world, this is expected to diminish, as software may limit the inquisitiveness required for mental growth. The next generation, born and growing in such an environment, is at higher risk as it faces serious challenges to cognitive development and the trajectory of human evolution. The digitally smart world has already created a revolution, where the comfort of easy availability, access and convenience has replaced the need for hard work, exploration and creativity, especially among young minds. Moreover, AI, which offers virtual assistants, reduces human interactions and interdependence necessary for social development. This, in the long run, may create an isolated environment as empathy, communication skills and cultural understanding slowly decline, impacting overall well-being and holistic human development.
Macroeconomic models identify growth as a function of labour force expansion, technological progress and human capital formation. India, and other countries in the developing stage, with population pressure and high unemployment, face an additional risk of structural shock. AI undeniably enhances productivity, but it has the capacity to develop technologies of such a nature and pace that can substitute labour, causing a displacement effect which can intensify the problem of unemployment. In a labour-surplus economy like India, this can have severe repercussions. Furthermore, the ubiquity of AI in every sphere means that the nature of unemployment may widen, affecting even the educated class. India is presently enjoying a demographic distribution, with the maximum population centred around the earning age; such structural disruptions and the resulting unemployment can be detrimental to long-term sustainable growth.
Further, there is a possibility of deepening income inequality, with favourable returns accruing to digital literates, technology developers, data controllers and established entrepreneurs able to incorporate the latest AI-driven technologies. Internationally, emerging economies attempting to enter global value and supply chains may face setbacks. Developed economies with technological advantages may further dominate and create digital dependencies for developing economies, aggravating the economic gap and concentration of economic power. The restructuring of the world due to the AI revolution is inevitable, and the way forward is not to resist or avoid it but to find ways to embrace it judiciously for the benefit of society.
The education system, especially schools, needs to take maximum responsibility for keeping curiosity alive among children and reducing dependence on technology. AI should rather be used to augment human capability with customised learning mechanisms and adapt to both fast and slow learners. Higher education institutions, at the same time, should invest in skilled education, which will make the younger generation competent and market-ready. The future of education has to be a hybrid and blended learning curriculum at every level, with a focus on AI and technology as assistive tools to provide students with a higher platform for learning. The Indian knowledge system, which aims to conserve a cultural and value-based society, will play an important role in the evolution of posterity.
Governments and policymakers, at the same time, need to frame strategies and provide incentives for promoting indigenous innovation to reduce digital dependence. India’s dream of becoming a manufacturing-driven growth economy, following China, will now have to be integrated with AI-based development, which can also help accelerate the rate of growth. Additionally, India should innovate ways to incorporate AI technologies to mitigate environmental degradation and waste management resulting from rapid industrialisation and urbanisation.
The key to AI as a paradox lies neither in escaping nor becoming dependent on it, but in complementing human development with technological advancement and using it as a catalyst to activate progress.
The writer is an assistant professor at Sri Guru Gobind Singh College of Commerce, Delhi University; views are personal
