Zoho Founder Warns AI Costs are Stifling India IT Jobs

Zoho Corporation founder and chief scientist Sridhar Vembu warned that the Indian IT sector is failing to create sufficient employment for the country's youth. He stated that capital previously reserved for hiring new employees is being diverted to cover the rising costs of artificial intelligence and data center infrastructure, driven by steep increases in server and memory prices.

Vembu noted that while Zoho Corporation has avoided large-scale layoffs, the company and the broader industry have largely stopped creating new positions. He questioned the necessity of producing more software in an over-saturated global market and expressed doubt that AI companies will achieve the profits required to justify such heavy capital expenditure.

Beyond IT, Vembu argued that automation in large-scale manufacturing prevents that sector from offsetting job losses. While automation makes goods more affordable, he suggested the economy must be restructured so citizens have the income to purchase them. This structural shift, he noted, may increase political pressure for Universal Basic Income in India, citing existing welfare schemes often termed freebies as a precursor to such support.