Artificial Intelligence models are becoming commoditised, so the bigger opportunity lies in applying AI in industries — manufacturing, finance, life sciences, supply chains and professional services. “That’s where countries like India can become frontrunners,” SAP chief executive Christian Klein told Surabhi Agarwal and Shristi Achar in a video interview.
The risk to India or the global IT and software services companies is only “if you are not transforming your workforce” to make it AI aligned, said Klein, 46, during his annual visit to India. Edited excerpts:
Given geopolitical tensions and macroeconomic uncertainty, are global enterprises shying away from large bets on AI right now?
Of course, there are geopolitical tensions, including the West Asia conflict, and risks around inflation and supply chain disruptions. But we have not seen a downward trend in IT spending. In fact, we continue to see a strong upward trend because companies increasingly view AI and IT as part of the solution to these challenges. Earlier, the focus was simply on investing in AI. Now the focus is on productivity gains and business outcomes.
At some point, the business case has to stack up. If inflation remains high, companies need to find productivity improvements somewhere in their operations, and AI can become a very strong lever for that.
There are concerns globally about too much AI power being concentrated in a handful of companies and countries. How do you see that risk?
It’s very important for us that customers have a choice and that we can run our full portfolio in India and out of India. When it comes to large language models, we give customers a choice. We are offering models from India and also the latest models coming from the US. Customers can move from model to model. There is no lock-in.
That independence is very important because customers do not want to become too dependent on a certain state or take on higher geopolitical risks. At the same time, I would not focus too much on trying to replicate existing LLMs. India already has extremely talented startups and engineers building AI solutions. I already see LLMs becoming commoditised. There will not be only one or two dominant models.
The bigger opportunity is applying AI to industries —manufacturing, finance, life sciences, supply chains and professional services. That is where countries like India can become frontrunners. The only risk as a software company or as a services company is if you are not transforming your workforce.
India’s IT industry currently is being threatened by the narrative that AI will kill IT and there will be mass layoffs. Will India continue to be the tech powerhouse for the globe?
India has all the ingredients required to win in AI. First, the talent pool is extraordinary. We find engineers and developers here who we do not find anywhere else in the world. The quality of technical talent and universities is extremely strong.
Second, India is investing heavily in AI infrastructure. Companies like TCS, Adani and Airtel are building the infrastructure that AI ecosystems need.
Third, you have a government that is strongly probusiness and focused on making India an even better place to invest in.
I recently met Prime Minister (Narendra) Modi in Sweden, and we discussed many of these initiatives. And globally, many companies increasingly see India as a trusted investment destination amid geopolitical tensions between China and the US. When I speak with European CEOs, many of them want to increase investments in India because of the resilience, stability and long-term opportunity they see here.
There is growing anxiety about the future of IT services as AI automates more coding and enterprise work. How do you see the future of Indian IT companies?
I remain very optimistic about the Indian IT ecosystem. Yes, there will be short-term disruptions. Some tasks that consultants perform today, especially around ERP (enterprise resource planning) migration or repetitive implementation work, will increasingly be automated by AI tools.
But at the same time, entirely new categories of work are emerging. AI agents still need to be implemented, trained, governed and adapted to complex enterprise environments. They need to understand business processes, data structures, regulations and customer-specific system landscapes.
We need our Indian partners to enable the agents to run in different system landscapes. We also need our Indian partners because they have a very good understanding of business processes and data.
What kind of talent is SAP looking to hire in India as it expands AI capabilities?
We are hiring aggressively in India, particularly for full-stack AI developers, forward-deployed engineers, data engineers and data scientists. As we build AI agents for enterprise use cases, we need engineers who can work directly with customers and deploy these systems across complex business environments.
We also need experts who can work on data layouts, AI foundations and training models on enterprise data. India is central to that strategy. We are investing heavily in partnerships with top universities in cities like Bengaluru and Delhi. We are not just recruiting students after graduation — we are engaging with them while they are still studying, training them on AI development and involving them in projects early on.
India is also the only country outside Germany where SAP has introduced its vocational student programme, where students alternate between working at SAP and attending university. That combination of practical experience and education has been very successful for us.
