NEW DELHI – India’s technology sector is proving its resilience yet again. According to the latest annual strategic review from NASSCOM, the industry is forecasted to reach a historic $315 billion in revenue for the fiscal year 2026 (FY26).
This projection represents a 6.1% year-on-year growth, a slight acceleration from the previous year, signaling a “structural transition” rather than a slowdown. Despite global macroeconomic headwinds and initial fears that automation might cannibalize traditional software services, the industry is successfully pivotting toward an AI-first model.
The AI Engine: From Experiment to Revenue
For the first time, NASSCOM has quantified the direct impact of artificial intelligence on the bottom line. AI-related services are expected to contribute between $10 billion and $12 billion to the total revenue in FY26.
“AI is moving from experimentation to execution,” noted NASSCOM President Rajesh Nambiar. “It is now a fundamental part of every business proposal.”
This shift is driven by:
- Scaled Deployments: Enterprises are moving beyond small AI pilots to full-scale industrialization.
- Global Capability Centers (GCCs): Over 50% of GCCs in India have now reached “transformation stage,” acting as innovation hubs rather than just cost-saving outposts.
- Specialized Verticals: High growth is being seen in healthcare tech, travel, and automotive electronics.
Employment and the “Human + AI” Workforce
While revenue is growing, the hiring model is undergoing a significant “decoupling.” The sector remains a net job creator, expected to add 135,000 new roles to reach a total workforce of 5.95 million. However, the growth rate of hiring (2.3%) is trailing behind revenue growth, reflecting massive productivity gains from automation.
To stay competitive, the industry has embarked on one of the world’s largest talent transformations. Over 2 million professionals have been upskilled in AI, with roughly 300,000 now possessing advanced expertise in “Agentic AI” and specialized domain knowledge.
Segment Breakdown for FY26
The $315 billion total is composed of diverse high-performing segments:
| Segment | Estimated Revenue (FY26) |
| IT Services | $149 Billion |
| Engineering R&D (ER&D) | $63 Billion |
| Business Process Management | $59 Billion |
| Software Products | $23 Billion |
| Hardware | $21 Billion |
As India heads into 2027, the focus is shifting from “scale-led expansion” to “value and innovation.” While traditional tasks are being compressed by AI, the expanding “opportunity frontier” in complex engineering and digital transformation suggests that India’s tech dawn is far from over.
