India’s finance minister isn’t worried about jobs being lost in the country’s manufacturing sector despite warnings that industrial robots will dramatically reduce the need for factory workers in coming decades.
“I still have faith in human ingenuity, that even when jobs are lost in certain sectors … more jobs will be created because of that increased economic activity in other sectors,” Arun Jaitley told CNN’s Fareed Zakaria on Sunday at the CNN Asia Business Forum in Mumbai.
Economists are increasingly concerned that developments in artificial intelligence and robotics will disrupt the business world in a similar way to previous industrial revolutions, leading to job losses.
Robots are likely to be performing 45% of manufacturing tasks by 2025, versus just 10% today, according to a study by Bank of America. And the rise of artificial intelligence will only accelerate that process as the number of devices connected to the Internet doubles to 50 billion by 2020.
In the highly-industrialized countries of East Asia, the trend is already on full display, with factories using fewer workers to produce more goods.
For India, the risk is that industrial robots will steal jobs from workers before the country has gained the benefits of having large numbers of its citizens employed in the manufacturing sector, where wages are traditionally higher than alternatives including agriculture.
Jaitley, a corporate lawyer and stalwart of the Bharatiya Janata Party, downplayed these risks. Even if jobs are lost, he said, the benefits of increased production will be a boon for the broader economy.
Jaitley and Prime Minister Narendra Modi visited Mumbai this week to promote their signature “Make in India” campaign, which aims to increase manufacturing and foreign investment in the country. In recent months, companies including GE(GE), Airbus(EADSF), Xiaomi, Foxconn and GM(GM) have all inked deals to expand their manufacturing operations in India.