AI steps out of cloud’s shadow in India’s IT industry

India’s IT services giants are increasingly treating artificial intelligence (AI) not as an offshoot of cloud computing but as a standalone growth vertical, reflecting the technology’s breakneck adoption and escalating client demand.

Executives say AI is no longer merely layered atop cloud infrastructure — it is beginning to define new revenue models, reshape talent strategies and recast client engagements. Senior leaders at Tata Consultancy Services (TCS), Infosys, Wipro, HCL Technologies (HCLTech), and Tech Mahindra have all publicly underscored the need to rethink legacy structures as generative AI transcends early expectations.

What began as cloud-enabled analytics is now evolving into AI-led transformation mandates, prompting firms to rewire internal business units and investment priorities.

AI momentum rewires IT firms’ mandates

A clear example is India’s largest IT exporter, TCS, which last year separated its combined “AI.Cloud” unit into distinct AI & Data and Cloud verticals — a move aimed at sharpening focus and accountability in both domains.

“For us, the volume and the vibrancy of activity we are seeing in the AI and data space has grown manifold in the last 12 months,” said Siva Ganesan, who heads the AI & Data business, underlining AI’s centrality in client conversations. “AI is now featuring in every client conversation. It's not just a technology add-on — it’s becoming the core of how businesses operate, differentiate and grow.”

Chief executive K. Krithivasan has articulated an even broader ambition: to make “every project AI-led”, embedding machine intelligence across service lines, from application development to infrastructure management.
The structural split signals more than a branding shift. It allows TCS to build AI-specific talent pools, forge specialised partnerships and price AI-led outcomes independently of traditional cloud migration deals.

Rival Infosys has similarly repositioned AI at the centre of its growth narrative. At its recent AI Day, the company showcased Topaz — its AI-first value framework — as a distinct strategic pillar, separate from cloud modernisation services.
Balakrishna D.R. (Bali), Executive Vice President and Global Head of AI and Industry Verticals, said the collaboration with Google Cloud aims to “empower enterprises to harness the real power of generative AI through collaboration and co-innovation.”

An expanded partnership with Amazon Web Services earlier this year, alongside a tie-up with Anthropic, underscores Infosys’s multi-cloud, multi-model strategy. Rather than collapsing AI into the cloud, the company is modularising both — positioning AI as an intelligence layer that can operate across hyperscaler ecosystems.

Industry analysts say this approach reflects client preferences. Enterprises increasingly want flexibility in choosing foundation models and deployment environments, even as they rely on service providers for integration and governance.

At Wipro, AI is being advanced as a parallel innovation stream. The company launched Lab45 AI in mid-2024, a platform supporting generative and deep learning models, aimed at building reusable enterprise AI solutions.
Subha Tatavarti, chief technology officer, described the platform as “a testament to Wipro’s commitment to innovation and productivity,” adding that it is designed to transform key business functions and accelerate customer value delivery.

Chairman Rishad Premji has highlighted the scale of internal AI upskilling, noting that hundreds of thousands of employees have been trained in generative AI fundamentals. The goal, executives say, is to ensure AI capabilities permeate delivery teams rather than remain confined to specialised labs.

Meanwhile, at IT firm HCLTech, AI is being woven into infrastructure services as well as workforce transformation initiatives. Leaders have observed that generative AI is redefining engineering careers, elevating competencies over traditional hierarchies.
Prince Jayakumar, Global Head of Talent Acquisition, has pointed out that advanced AI tools are creating new roles even as they reshape skill requirements across legacy positions. Chairperson Roshni Nadar Malhotra has stressed that AI is intended to augment, not replace, jobs — with responsible deployment and reskilling central to strategy.

Tech Mahindra nonetheless has adopted a more calibrated tone. In a recent media interview, Tech Mahindra chief executive Mohit Joshi said claims of AI-driven productivity gains of 70–80% over five years, being pitched by some IT firms to clients, are an unsustainable and “dangerous bet” that falls in the realm of fantasy. He added that Tech Mahindra is instead adopting a more realistic and measured approach to what he described as the most significant technology shift in decades.

Even so, the company continues to push industry-specific AI deployments across telecom, manufacturing and financial services — indicating that scepticism around hype does not equate to strategic hesitation.

A structural, not semantic shift

Mid-tier players such as Persistent Systems, Coforge and Mphasis are also scaling generative AI deployments, suggesting that the decoupling of cloud and AI is industry-wide rather than confined to top-tier firms.

The shift aligns with India’s broader AI approach, which prioritises application-driven adoption over frontier model development. In practice, companies are leveraging existing cloud infrastructure while building standalone AI capabilities that can be packaged, priced and delivered independently.

For India’s IT services sector, this marks an operational recalibration rather than a departure from cloud-led transformation. While cloud remains foundational, AI is increasingly being organised, measured and monetised as a distinct growth engine — reflecting how client demand and deal structures are evolving.