Automation and Artificial Intelligence (AI) are no longer emerging technologies—they are powerful forces reshaping global economies. For India, a country with a large workforce, growing digital infrastructure, and ambitious economic goals, automation and AI represent both an opportunity and a challenge. Their impact spans economic growth, employment patterns, productivity, and the quality of products and services, while global developments in countries like the United States and China offer valuable lessons.

Understanding Automation and AI

• Automation involves using technology to perform repetitive or rule-based tasks with minimal human intervention.

• Artificial Intelligence (AI) enables machines to learn from data, recognize patterns, make decisions, and improve over time.

Together, they power applications such as robotic process automation (RPA), predictive analytics, computer vision, natural language processing, and intelligent robotics.

Impact of Automation and AI on India

1. Impact on the Indian Economy

Automation and AI are becoming key contributors to India’s economic transformation. They support:

• Faster industrial output

• Lower operational costs

• Increased competitiveness of Indian businesses globally

AI adoption across manufacturing, banking, healthcare, logistics, and agriculture is helping India move up the value chain—from cost-driven services to innovation-led growth. As digital capabilities mature, AI is expected to significantly boost India’s GDP over the coming decade.

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2. Impact on Employment

Employment impact is often the most debated aspect of automation.

Challenges

• Routine, repetitive jobs—especially in manufacturing, data entry, and basic services—are at risk of displacement.

• Low- and semi-skilled roles face higher automation exposure.

Opportunities

• New roles are emerging in AI development, data science, cybersecurity, system integration, and digital operations.

• Demand is growing for hybrid skills combining domain knowledge with digital expertise.

In India, the shift is not about job loss alone, but job transformation. The long-term employment outcome depends heavily on reskilling, upskilling, and education reforms.

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3. Impact on Productivity

Automation and AI significantly enhance productivity by:

• Reducing errors and rework

• Enabling 24/7 operations

• Accelerating decision-making with real-time insights

Indian organizations using AI-driven analytics and automation report higher output with the same or fewer resources. This productivity boost is especially important for SMEs aiming to scale without proportionally increasing costs.

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4. Impact on Quality of Products and Services

AI-driven systems improve quality through:

• Predictive maintenance reducing defects

• Computer vision ensuring consistent quality checks

• Personalized services in banking, retail, and healthcare

As a result, Indian consumers experience better reliability, faster service, and more customized offerings, while businesses gain stronger brand trust and customer satisfaction.

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Global Perspective: Lessons from the USA and China

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United States: Innovation and Enterprise AI

The United States leads in AI innovation, driven by:

• Strong research universities and private investment

• Advanced AI adoption in healthcare, finance, defense, and enterprise software

• High use of automation to enhance productivity rather than replace skilled labor

The US model shows how AI can create high-value jobs, improve service quality, and strengthen global competitiveness when paired with innovation ecosystems.

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China: Scale, Speed, and Industrial Automation

China has rapidly deployed automation and AI at scale:

• Extensive use of robotics in manufacturing

• Government-led AI strategies and infrastructure investment

• AI-powered smart cities, logistics, and surveillance systems

China demonstrates how large-scale automation can dramatically improve productivity, reduce costs, and dominate global manufacturing—but also highlights the importance of managing workforce transitions.

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What India Can Learn

From the USA and China, India can draw three critical lessons:

1. Invest in Skills – Continuous reskilling is essential to ensure inclusive growth.

2. Encourage Innovation – Strong collaboration between startups, industry, and academia accelerates AI adoption.

3. Adopt Responsible AI – Ethical use, data privacy, and transparency must be integral to AI strategies.

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The Road Ahead for India

Automation and AI will play a decisive role in India’s ambition to become a global economic powerhouse. When aligned with education reform, digital infrastructure, and supportive policies, these technologies can:

• Drive sustainable economic growth

• Create higher-quality employment

• Improve productivity across sectors

• Deliver world-class products and services

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Conclusion

Automation and AI are reshaping India’s economy—not by replacing human effort entirely, but by augmenting it. The experiences of the USA and China show that the real advantage lies in how strategically these technologies are deployed. For India, the future belongs to businesses and institutions that embrace automation and AI responsibly, invest in people, and focus on long-term value creation.

The challenge is real—but so is the opportunity.

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Key discussions included fiscal federalism, infrastructure and capital expenditure, support for MSMEs, social welfare spending, and green growth initiatives. States highlighted the need for better resource allocation, flexibility in fiscal management, and sustained support for development programs.

The consultation underlined the Centre’s commitment to cooperative federalism and inclusive growth. Insights from the meeting are expected to influence policy decisions that impact taxation, infrastructure development, and business growth, especially for SMEs and regional economies.

Such collaborative discussions play a vital role in shaping a balanced and growth-oriented Union Budget for India.

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During the interaction, economists recommended targeted tax incentives to boost investment, consumption, and savings. Simplification of the tax structure and measures to encourage voluntary compliance were highlighted as critical steps to improve ease of doing business and support long-term economic stability.

A major highlight of the discussion was the push for expanding data centres in India. With rapid digitalisation, growing cloud adoption, and rising data consumption, experts stressed the need for supportive policies, infrastructure status, and stable taxation to position India as a global data centre hub. Investment in digital infrastructure is expected to strengthen India’s technology ecosystem and attract foreign capital.

Economists also underscored the importance of export policy reforms and export diversification. Expanding exports beyond traditional markets and products, particularly in high-value manufacturing, technology services, and emerging sectors, was seen as vital to improving India’s global competitiveness and reducing external vulnerabilities.

Prime Minister Modi emphasised mission-mode reforms and a consultative approach to policymaking, aligning fiscal priorities with India’s long-term growth vision. The outcomes of the pre-Budget meeting are expected to influence policy announcements in the Union Budget 2026, with a focus on investment-led growth, digital infrastructure, and export expansion.

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Under the revised norms, directors will now be required to complete KYC verification once every three years, instead of the earlier annual filing mandate, provided there are no changes in their personal or identification details. Previously, directors were required to submit DIR-3 KYC on a yearly basis.

The move is intended to simplify corporate compliance processes while ensuring continued regulatory oversight. By cutting down repetitive filings, the government aims to lower administrative costs for companies, especially small and medium enterprises, and improve overall efficiency in corporate governance.

The MCA has clarified that directors must still update their KYC details immediately in case of any changes related to address, mobile number, email ID, or identity documents.

Industry stakeholders have welcomed the decision, viewing it as part of the government’s broader push towards compliance rationalisation, digitisation, and ease of doing business in India.

This reform is expected to provide practical relief to companies, professionals, and directors managing statutory compliance obligations.

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Income earned by freelancers are known as freelancing income. As per Income Tax laws in India , freelancing income is categorized as self employed income and for tax purpose it is treated as “Profit and gains from business or Profession”. Any Income , which is earned by displaying intellectual or manual skills is the Income from a profession according Income tax laws in India.

CALCULATION OF GROSS INCOME AND NET INCOME OF FREELANCER

Gross Income

Aggregate of all receipts whether in cash or in bank will be treated as Gross Income of Freelancer.

Net Income

All expenses incurred for the freelancing work will be allowed as deduction from Gross Income.

Net Income     = Gross Income-All expenses relating to freelance work

Gross Taxable Income

If freelancer earn any other income other than freelancing income such as Interest, Rent, Profit on sale of property, that income will be added in net income of the freelance. Total of this is called gross total income.

Gross Total Income  = Net Income + Income from any other sources

Net Taxable Income

Income tax laws allow deduction of some saving made by individual/HUF under section 80C to 80 U from Gross Total Income. This encourages taxpayers to save for futurs.

Net Taxable Income  = Gross Total Income – Deduction U/s 80C-80U

Advance Tax for a freelancers

If the Income tax liability during a financial year exceeds Rs.10,000/- , the freelancer has to pay tax in advance. Payment of this tax is called Advance Tax. Advance tax is paid in every quarter during financial year.

Due date of advance tax:

On or before 15^th June                 15% of Total Tax Due

On or before 15^th September       45% of Total tax Due

On or before 15^th December        75% of Total Tax Due

On or before 15^th March    100% of Total Tax Due

ITR

A Freelancer can opt for ITR 3 or ITR 4 for filing Income Tax Return.

GST LAWS AND FREELANCERS

If gross receipts from freelancing services exceeds Rs. 20 lakhs during the financial year, the GST Laws apply to freelancer and freelancer is mandatory required to register under GST. In India 18% GST applies on most services. So freelancer must charge 18% GST from Clients.

THINGS TO REMEMBER UNDER GST

• If the gross receipts from freelancing services does not exceed 20 lakhs p.a. , the GST does not apply.
• Composition Scheme does not apply on services
• GST does not apply on export of services
• Invoices must be according to GST laws

For more information visit www.cadkc.in

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6. Income of a non-resident from offshore derivative instruments, or over the counter derivatives issued by an offshore banking unit, income from royalty and interest on account of lease of ship and income received from portfolio management services in IFSC shall be exempt from tax, subject to specified conditions

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Following are some of the activities which are treated as supply for charging GST in Real Estate –

• Renting of residential property
• Construction of a residential complex, building including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate by the competent authority or after its first occupation
• Works Contract i.e. a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any residential property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract

Applicability of GST on construction of apartments in a real estate project
With effect from 01.04.2019, rate of GST applicable on supply of construction service involving transfer of property in land shall be as follows –

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Now, all eyes are on Finance Minister Nirmala Sitharaman as this year’s Union Budget is about to be unveiled. Start-ups are looking for policy changes that will help them surge ahead and boost recovery from the long drawn-out pandemic.

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