The Indian technology landscape in 2025 presents a paradox: while local IT giants are downsizing, Big Tech companies continue to expand their presence and hiring in the country. This divergence reflects the evolving nature of the industry, driven by rapid technological advancements and shifting global economic priorities.
Several major Indian IT companies are currently undergoing workforce reductions. Tata Consultancy Services (TCS), for example, plans to lay off over 12,000 employees, primarily impacting middle and senior management. This decision is attributed to the company's efforts to become "future-ready" by investing in innovative areas like artificial intelligence (AI) and streamlining operations. The Ministry of Information Technology (MeitY) is closely monitoring these developments. Other Indian IT firms are also experiencing similar pressures, with an estimated 50,000 tech jobs lost in hubs like Bengaluru, Hyderabad, and Pune in the past year. This reduction in workforce is also driven by the rise of AI, compelling US companies to seek lower operational costs, resulting in a leaner workforce within Indian IT firms.
The skills gap is a significant factor contributing to these layoffs. The National Association of Software and Service Companies (Nasscom) estimates that there will be a demand for one million AI professionals by 2026, but less than 20% of the current IT workforce possesses the necessary qualifications. While companies are investing in upskilling initiatives, those lacking expertise in emerging technologies face potential job displacement. This situation has led to a surge in demand for specialized tech roles, with recruitment for AI specialists, data scientists, and blockchain coders seeing a significant spike.
Despite the belt-tightening measures by local IT firms, FAAMNG (Facebook, Apple, Amazon, Microsoft, Netflix, Google) companies are expanding their India headcount. These Big Tech companies have grown by 16% in the past year, driven by the demand for AI, cloud computing, and cybersecurity skills. Their India-based global capability centers (GCCs) are increasing hiring for high-end work and innovation, signifying a strategic focus on leveraging India's talent pool for advanced technology development. GCCs accounted for over half of tech job openings in 2024 and are projected to create 2.8 million jobs by 2030.
The contrasting trends highlight a fundamental shift in the Indian IT sector. The traditional model of providing low-cost skilled labor for software development is evolving, with businesses now prioritizing innovative solutions and advanced technological capabilities. This transformation necessitates a workforce equipped with expertise in AI, machine learning, cloud computing, and data security. As a result, Big Tech companies, with their focus on cutting-edge technologies, are finding India an attractive destination for talent acquisition and expansion.
For job seekers, this means focusing on acquiring skills in these high-demand areas. The tech job market in India is experiencing a major transformation in 2025, with fresh graduate hiring expected to surge. Starting salaries are promising, with entry-level positions in roles like penetration testing and data science offering competitive packages. Emerging cities like Kochi and Coimbatore are also becoming attractive alternatives to traditional tech hubs.
In conclusion, while some Indian IT firms are facing headwinds and workforce reductions due to skills mismatches and evolving market dynamics, Big Tech companies are capitalizing on the demand for specialized skills and expanding their operations in India. This trend underscores the importance of continuous learning and adaptation for professionals in the IT sector to remain competitive and take advantage of the opportunities presented by the ever-changing technology landscape.
