Artificial Intelligence (AI) is rewriting global job markets and India has suddenly become one of the countries best positioned to gain from it, said Kristalina Georgieva, Managing Director of the International Monetary Fund.
In an exclusive interview with India Today TV, the IMF chief said early evidence from countries studied so far shows a “positive” impact on employment, although the gains are uneven and India will have to prepare carefully to avoid widening gaps.
She pointed to India’s digital groundwork as a key advantage, saying, “India invested over the last years in digital public infrastructure. It is the foundation for AI to be more accessible.”
AI JOBS PAY MORE, BUT MIDDLE ROLES ARE SHRINKING
Georgieva also pointed to the United States to explain how AI is affecting salaries and job profiles. “Already in the United States, one in ten jobs require AI enhanced skills, and it pays more,” she said.
Workers with AI-related skills are earning higher salaries and spending more money. That spending is pushing up demand for low-skilled service jobs in restaurants, hotels and entertainment.
However, the middle of the workforce is feeling the pressure. Georgieva said much of the employment growth linked to AI is coming from lower-paying roles, which is shrinking the space for mid-income jobs.
She added that automation is erasing many entry-level positions. “We also see automation eliminating entry-level jobs. So recent graduates worry, where is the job for me?”
WHY POLICYMAKERS MUST ACT NOW
Georgieva said governments cannot sit back and watch these changes unfold. “We are not helpless,” she said.
Her first recommendation is to overhaul education. “Redefine education for the era of AI. Learn to learn and be adaptable,” she said, stressing that workers will need continuous skill upgrades as job profiles evolve.
Her second recommendation is to build stronger social safety nets so people have support if they are temporarily displaced. She praised Denmark’s “flex security” model, which combines flexible labour markets with strong worker protection. She also welcomed India’s labour reforms but said flexibility must be matched with security.
DOES INDIA HAVE AN EDGE?
According to Georgieva, India’s biggest strength in the AI era comes from long-term investment in digital public infrastructure. “India invested over the last years in digital public infrastructure. It is the foundation for AI to be more accessible,” she said.
She highlighted India’s digital ID system covering 1.4 billion people and said the democratisation of AI in the country is “impressive.”
She added that India’s approach of building AI for specific sectors and public needs could become a model for developing countries.
GUARDRAILS NEEDED
Georgieva said AI could lift global growth by about 0.8 percent, potentially pushing growth above the “anaemic” 3.3 percent currently seen worldwide.
However, she warned that the absence of guardrails is a major concern. “We want AI for good, not for evil. We want AI that protects dignity and the rights of humans,” she said.
Countries, she added, must work together to create ethical frameworks and sensible safeguards without stifling innovation. “We have seen far too many times suffocating innovation with excessive regulation.”
EUROPE, REGULATION AND THE BALANCE
Drawing from her experience in Europe, Georgieva said the region prefers “efficient regulation” rather than sweeping deregulation.
She said Europe will have to simplify rules, deepen its single market and allow freer movement of capital and skills while maintaining protections for workers.
TRADE TENSIONS AND A MULTIPOLAR WORLD
On global trade, Georgieva said US tariffs initially jolted markets, but many countries responded by strengthening regional and bilateral agreements instead of retreating.
“Trade is like water. You put an obstacle, it goes around it,” she said.
She added that the world is clearly multipolar now. Trade relations may become more complex, but global trade will continue. “We cannot pull apart. There is no going back.”
In short, Georgieva’s message was that AI offers enormous opportunity but also real risks. It can raise growth and create jobs, but it can also deepen inequality, squeeze middle-income workers and make life harder for young people entering the job market.
The solution, she said, is balance. Countries must encourage innovation, invest in people, strengthen worker protection and build smart guardrails. If they do, AI could lift economies. If they do not, it could widen divides that already exist.
