India Automated - an extract

This is an extract from Pranjal Sharma's book India Automated. Join the World Economic Forum Book Club to discuss.

India is a country where almost a million job seekers join the economy every month. A country where the government, academia and the industry have mostly imprecise information about job creation. A country where unemployment rates are growing steadily. A country where hundreds of thousands apply for low-level government jobs. A country of 1.3 billion people that is on the verge of overtaking China as the most populous nation in the world.

India is also the country where automation is on the rise.

The use of robotic systems for industrial automation is not new to India. But what stands out in recent times is the steady growth in its use. Despite a large and increasing working population, automation is growing across sectors – from traditional industries in manufacturing to government systems and even the services sector – and functions – from hiring processes to tax management to personal finance to water management and electricity conservation. There is now at least one element of automation built into the system in almost everything we see, experience and use.

There is a counter-intuitive change taking place in India. While automation can on the surface appear to be anti-workforce and anti-employment in a country of 1.3 billion, it is rising faster and deeper than is visible. Robotic process automation (RPA) is changing business and government operations at an unprecedented scale.

The impact of all the technologies –AI, drones, blockchain, additive manufacturing, augmented and virtual reality – is the rise of automation in India. Automation is turning into the single biggest impact of the use of Fourth Industrial Revolution technologies in India. All the fourth industrial revolution technologies are bound by the common impact of automation. Every usage of each of these technologies is enabled by or triggers automation in some form.

For the industry, the age of automation is increasingly becoming not so much about saving labour but about data itself. While automation can save some labour cost, the investment in robotics is often higher.

So, the shift is not about saving costs, but about getting better and real-time insights into internal operations and client-facing functions. We live in an era of not just information overload but also instant information. Information overload, which overwhelms readers and viewers of news, has now been recognized as a negative force that impairs our ability to filter the unnecessary and the incredible.

In the world of industry though, additional information is improving business decisions and enhancing efficiency. Phrases like internet of things (IoT) and connected devices are used fairly liberally, but their real impact is on the information that they generate. The quality, speed and quantum of information is helping small and large businesses understand their own organizations much better.

In an industrial environment, if the machines are able to generate data about their own activity, the entire manufacturing process can offer instant insights to managers. Much of the delay in decision making happens because of outdated information systems. By the time the reports are analyzed and corrective actions are taken, the company would have suffered faulty products or the time for taking predictive action would have passed.

The transparency created by data-generation adds to the robustness of decision-making. Companies are deploying this approach to different segments of the manufacturing process. Some are getting data on logistics value chain; others are using it for tracking and managing energy consumption; while some are tracking the efficiency of assembly lines. Instant information on each of these fronts can be deeply beneficial to the company. Very few companies have been able to connect their entire spectrum of activities in the manufacturing process. It is not surprising then that demand for data scientists is rising rapidly. It has grown over 400 per cent between 2017 and 2018 according to the Talent Supply Index of the HR firm Belong.

Another study by the consulting firm Zinnov has assessed that India is well-placed to manage the automation and data-led world. India is second among the top ten countries with RPA talent. The country has about 48,000–50,000 professionals with skills that include AI/ML, NLP, natural data generation (NLG) and deep learning.

The natural data generation programmes can convert data sets into English language text. A software can automatically create a story or a report based on numbers. This is similar to what an analyst or a market report would do after reading a company’s financial results.

The US is marginally ahead of India with over 52,000 professionals. India cannot take its lead over other countries for granted, as those countries can swiftly upskill their professionals.

While physical robot-led automation is prominent, much of the automation is invisible since it is being done by software. Automation processes that are AI-based are already deeply embedded in consumer, business and government processes. The two key drivers of automation in India are thus physical robots and AI-based solutions.

There is one benefit of automation for India which does not apply to other countries. Many jobs which are dirty, dangerous, difficult and even dull will be removed. Workers in industrial zones still work in abysmal conditions. Physically dangerous labour is a common sight at construction sites across the country. Mechanization has enhanced, but Indian engineering, procurement and construction (EPC) companies have a poor track record of worker safety. Dirty and dangerous manual scavenging is still the norm in most cities.

Difficult work includes paperwork that government clerks have to sift through. Tax departments are pushing for cashless economy and using electronic tax returns. The taxmen now have to use automation to investigate and seek fraud. Using automation, they can also process returns faster and give refunds to taxpayers with lesser time lag.

The World Bank has recognized that over 50 per cent of new bank accounts opened in 2014–17 were in India. Over 340 million new accounts were opened between 2014 and 2019, according to the government. The banking sector has no choice but to use automation-based process to manage this rise in the number of customers and users. This is dull work. A purely human effort to manage rising bank accounts will be time-consuming and inefficient. Dirty, dangerous, difficult and dull jobs are not aspirational. There is no reason why India should encourage this. Automation is the future.

Automation is helping create important information in a data poor country. It is making Indian private sector and government machinery more transparent and efficient.

As automation deepens in India, the impact on quantity and quality of employment will also be high. This needs to be studied and efforts need to be made to mitigate the negative while enhancing the positives. Recognition of the rise of automation in India will be the first big step towards embracing it, preparing and planning for it.

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