Businesses and individuals in India must seize the benefits of AI and strategically enhance their competitiveness by staying abreast of advancements in AI
Technology is advancing at an unprecedented rate, bringing emerging technologies like Artificial Intelligence (AI) to the forefront. The impending disruption caused by AI is evident, underscoring the importance of AI literacy. Understanding AI is paramount in this context. India finds itself in a delicate position due to its distinctive demographic dividend and dependence on Micro, Small, and Medium Enterprises (MSMEs) for growth. For instance, the Uttar Pradesh government has launched the “AI Literacy for All” initiative in state schools, aiming to educate students on AI, coding, and Machine Learning (ML). This effort seeks to equip the younger generation with the necessary tools for success in an increasingly digital world.
The swift pace of technological advancement demands a workforce capable of effectively leveraging AI tools, including businesses, particularly MSMEs, to tap AI's potential.
As we navigate through this rapidly changing technological landscape, the ability to grasp, utilise, and ethically deploy AI becomes essential for societal and economic progress. The swift pace of technological advancement demands a workforce capable of effectively leveraging AI tools, including businesses, particularly MSMEs, to tap AI's potential. Acknowledging AI's multifaceted impact on societies, businesses, and daily life is prudent and imperative for driving advancement and competitiveness.
AI's impact on society is all-encompassing, from aiding disease surveillance to enhancing social media experiences with photo filters and beyond. Thus, AI literacy is imperative. In simple terms, AI literacy is the ability to learn and navigate AI-driven technology. Learning how to use the tools available will be key to development. It is vital to understand the use of AI, how it shapes our society, and the impact it can have on the day-to-day business of working people. The nexus between AI literacy and job opportunities underscores the transformative potential of AI, especially in developing countries. Acquiring skills in AI opens doors to employment opportunities across diverse industries. From data analytics to machine learning, a workforce well-versed in AI becomes a valuable asset, attracting foreign investments and driving economic growth. Learning how to utilise the different AI tools for businesses properly means increasing productivity, fast-tracking production, and understanding consumer trends. Currently, there are more than 6 crore MSMEs that provide more than 11 crore jobs in India. Understanding how to properly utilise AI tools can help give job-seekers the edge to break into the sector.
AI is poised to disrupt nearly every sector of the economy. Consequently, policymakers must prioritise safeguarding critical sectors, with India's MSME sector being of paramount importance. As India looks to position itself as an AI innovation hub, it is emphasising the importance of AI literacy. One initial step is acknowledging India's demographic dividend and readying it for the future. India is actively incorporating AI in schools to revolutionise education and prepare students for the future. The National Education Policy (NEP) 2023 recognises the transformative potential of emerging technologies such as AI, ML, big data analytics, and visualisation in education. The goal is to enhance teaching-learning and assessment processes, support teacher preparation and professional development, increase educational access, and streamline educational planning, management, and administration. To achieve this, it aims to establish a robust ecosystem of digital education where teachers, students, parents, and administrators are well-informed about the appropriate use of technology, emphasising safety and security measures.
The goal is to enhance teaching-learning and assessment processes, support teacher preparation and professional development, increase educational access, and streamline educational planning, management, and administration.
One such initiative is the Responsible AI for Youth (YUVAi) programme, a collaboration between the National e-Governmence Division, the Ministry of Electronics and Information Technology, and Intel India. It aims to empower the young generation by making them AI-ready. The platform focuses on helping students develop a new-age tech mindset and acquire relevant skill sets. By integrating AI education into the curriculum, YUVAi ensures that students at the national, state, and school levels are aware of these technologies, their roles, and how to discern their use and impact. This proactive approach aims to equip students with the knowledge and skills needed to navigate the digital landscape responsibly.
Expanding AI literacy initiatives from the youth to business owners could also be beneficial. In today's increasingly AI-driven business environment, having a solid grasp of AI principles can empower entrepreneurs and business leaders to make informed decisions about incorporating AI solutions into their operations. This, in turn, can lead to increased efficiency, productivity, and innovation within their enterprises. AI literacy ensures that businesses can adapt to changing market dynamics, stay ahead of technological advancements, and capitalise on opportunities for growth and innovation. Fostering AI literacy, particularly among MSMEs, will equip them with the tools to navigate the digital age effectively and contribute to the overall economic development by fostering a tech-savvy and resilient small business sector.
MSMEs are considered the backbone of socio-economic development. In India, the MSME sector plays a crucial role in the country's economic landscape, contributing significantly to employment generation, innovation, exports, and inclusive growth. It accounts for 45 percent of total industrial production, and 40 percent of total exports, and makes a substantial contribution to the GDP, with a total share of 37.54 percent. Recognising the need for a conducive business environment, the Ministry of MSME emphasises the importance of a thriving entrepreneurial ecosystem for realising the sector's potential and ensuring sustainable growth.
Drawing insights from larger corporations, they can leverage AI technology to optimize sales strategies, anticipate consumer trends, forecast market dynamics, and streamline operational processes.
AI literacy holds immense potential in empowering MSMEs to thrive in today's dynamic business landscape. By enhancing their understanding of AI applications across various sectors, MSMEs can unlock new opportunities for growth and efficiency. Drawing insights from larger corporations, they can leverage AI technology to optimize sales strategies, anticipate consumer trends, forecast market dynamics, and streamline operational processes. Moreover, AI's impact extends beyond mere business operations to encompass areas like public administration, legal systems, taxation, and digital infrastructure. MSMEs can navigate these complexities by gaining insights into available government schemes, financing options, and policy frameworks tailored to their needs.
AI tools such as financial and inventory management can help small businesses save money, and others such as email marketing automation can help increase their consumer base. A key area where AI literacy can make a significant difference is in data analysis and decision-making. With AI algorithms capable of processing vast amounts of data rapidly, MSMEs can derive actionable insights to inform strategic decisions and drive business growth. For example, a Gurugram-based HR consulting firm called Culturro used Scalenut, an AI platform that provides services such as Cruise Mode, which helps with content creation and marketing. Ashish Manchanda, the co-founder of Culturro, said that “AI tools can help small companies like ours scale up their efforts across the entire content spectrum”
With AI algorithms capable of processing vast amounts of data rapidly, MSMEs can derive actionable insights to inform strategic decisions and drive business growth.
To fully harness the benefits of AI, MSME managers and employees must be educated about its potential advantages. This involves raising awareness about AI's benefits, addressing financial constraints, and ensuring access to relevant knowledge resources. Additionally, tailored approaches, sector-specific studies, and practical business use cases can further empower MSMEs to embark on a successful AI journey, fostering inclusivity and informed decision-making across the sector.
India is emerging as a leader as the world becomes increasingly digital and technologically reliant. However, with every technological innovation, disruption follows, leading to the transformation and, in some cases, the closure of sectors and businesses. It is important to note that such disruptions also create new businesses and jobs.
Businesses and individuals must seize the benefits of AI and make strategic improvements to remain competitive.
The impact of AI disruption is imminent and will affect everyone. Businesses and individuals must seize the benefits of AI and make strategic improvements to remain competitive. Failing to do so would mean missing out on potential opportunities. With India's growing digitalisation efforts and improving internet connectivity, it is plausible to envision MSMEs leveraging AI tools to enhance their operations. Educating India's young demographic and MSMEs in AI literacy could serve as a starting point for this transformation.
Tanya Aggarwal is a Research Intern at the Observer Research Foundation
The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.
Tanya Aggarwal is a Research Assistant at the Center for Security, Strategy, and Technology at ORF. Her research focuses on the intersection between technology and ...
Read More +
PREV
