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Why AI will be the Catalyst for a new era of productivity growth

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Image by Lin Tong from Pixabay

The dawn of the artificial intelligence (AI) era is often compared to transformative technological advancements such as the steam engine, electricity, and the personal computer. These innovations reshaped industries and daily life, and AI is poised to make an equally revolutionary impact, particularly on global productivity. While the effects of AI are still unfolding, experts believe that its ability to significantly boost productivity could happen in record time—just seven years, compared to decades for earlier technological revolutions.

This optimism comes at a critical juncture in the global economy. Post-pandemic, many countries are grappling with stagnating growth, rising inflation, and mounting debt, alongside the fundamental issue of declining productivity. In fact, several international agencies have noted that the productivity decline following the global economic downturn is unprecedented in recent history. Yet, AI is emerging as a way of hope, offering the potential not only to reverse this trend but to propel productivity to unprecedented heights.

the new era of productivity

The Economic Impact of AI: A Long-Awaited Leap

The global economy has struggled with low productivity growth for over a decade. For example, U.S. labour productivity growth averaged just 1.68% from 1998 to 2007, a period during which significant technological innovations like the internet and personal computers began to take root. But since 2010, productivity growth has fallen further, dipping to 0.38% between 2010 and 2019.

Some forecasts suggest that generative AI alone could add between $2.6 trillion and $4.4 trillion to the global economy

In this environment, AI is seen as the key to unlocking a new wave of economic efficiency. According to recent reports from the International Monetary Fund (IMF), AI technologies are expected to drive a substantial increase in global productivity. Some forecasts suggest that generative AI alone could add between $2.6 trillion and $4.4 trillion to the global economy.

To understand the potential of AI in the context of productivity growth, it’s useful to compare it to previous technological breakthroughs. The steam engine, for example, took about 60 years to fully transform productivity in manufacturing. Personal computers accelerated productivity growth over 15 years. By contrast, AI is expected to have a profound impact on productivity within just seven years.

Generative AI and Its Promising Future

Generative AI is a form of artificial intelligence that creates new content—whether it’s text, images, or even software code—based on patterns learned from large datasets. The speed with which generative AI is advancing is extraordinary. ChatGPT, released in November 2022, was quickly followed by a more advanced version, GPT-4, and other breakthroughs have appeared throughout 2023. This technology is expanding rapidly, with the capability to process tens of thousands of words in a minute, creating a powerful tool for automating complex tasks.

The applications of generative AI are vast and varied. In the business world, AI systems are already transforming industries like customer operations, marketing, software engineering, and research and development. The banking sector, for example, is projected to see an annual revenue increase of $200 billion to $340 billion through the adoption of AI. The retail and consumer goods sectors could see similar gains, potentially adding up to $600 billion annually.

AI’s potential to automate routine tasks could also free up significant amounts of time for human workers. Studies indicate that generative AI could automate between 60% and 70% of the tasks currently performed by employees, dramatically increasing efficiency. For knowledge-based workers, particularly in high-wage and high-skill sectors, AI is poised to amplify productivity by reducing time spent on routine tasks, such as data analysis, customer service, and administrative work.

Transforming Labour Markets: A Double-Edged Sword

However, the rapid rise of AI is not without its challenges, particularly when it comes to labor markets. Many fear that the widespread adoption of AI could lead to massive job displacement, especially in developed countries where white-collar jobs are more susceptible to automation. According to the IMF, while 30% of U.S. jobs may be at risk of automation by AI, only 13% of jobs in India are likely to be affected, reflecting the differing technological capabilities and labor market structures across the globe.

At the same time, AI’s integration into the economy is expected to create new job opportunities, especially in fields that require advanced technical skills, such as AI development, data science, and cybersecurity. This pattern mirrors historical trends: when previous technological revolutions disrupted the labor market, they also created entirely new industries and job categories. A recent study by MIT found that 60% of the jobs in America today did not exist in 1940, highlighting the constant evolution of the labor market in response to technological innovation.

AI’s Role in Healthcare: Beyond Productivity

AI’s potential extends far beyond traditional sectors like manufacturing or finance. The healthcare industry stands to benefit greatly from AI’s ability to analyze vast amounts of medical data quickly and accurately. For example, AI systems can assist doctors by analyzing scan reports, identifying patterns, and recommending treatment protocols. AI can also reduce the burden of administrative tasks, such as summarizing doctors’ notes and processing insurance claims, thereby improving productivity in healthcare settings while also reducing costs.

Generative AI is now widely recognized as a general-purpose technology (GPT), similar to electricity or the personal computer

Such advancements could lead to significant improvements in healthcare delivery, making it more efficient and cost-effective. This would not only improve outcomes for patients but also contribute to economic growth by lowering healthcare costs for both consumers and governments.

The Path Forward

Generative AI is now widely recognized as a general-purpose technology (GPT), similar to electricity or the personal computer. These technologies have historically contributed to broad-based productivity growth across multiple sectors. The key to AI’s success as a GPT lies in its ability to integrate seamlessly with existing technologies and applications across various industries, driving continuous innovation and productivity gains.

The widespread adoption of AI in industries like logistics, manufacturing, education, and even creative arts has the potential to revolutionize how businesses operate and how workers contribute. As businesses continue to integrate AI into their processes, the resulting efficiencies will likely lead to increased competition, lower prices, and higher wages for workers in industries that embrace these changes.

AI’s transformative potential for global productivity cannot be overstated. Just as the steam engine and personal computers reshaped industries and economies, AI is positioned to trigger an unprecedented leap in productivity across nearly every sector. While challenges related to job displacement and economic inequality remain, the promise of a future in which AI drives substantial economic growth is undeniably exciting.

As AI continues to evolve, it is crucial for businesses, policymakers, and workers to embrace this change, adapting to new technologies and fostering an environment that allows AI to reach its full potential. The future of productivity is unfolding before us, and AI will be at the centre of this revolution.

Climate

Could Global Warming Make Greenland, Norway and Sweden Much Colder?

A Nordic Council report warns that global warming could make Norway colder if the Atlantic ocean circulation collapses, triggering severe climate impacts.

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Could Global Warming Make Greenland, Norway and Sweden Much Colder? Nordic Report Says Yes
A new Nordic report warns global warming could drive parts of northern Europe into far colder conditions if a major Atlantic ocean current collapses. Hamnøy, Norway. Image credit: Petr Slováček/Pexels.

Global warming is usually associated with rising temperatures—but a new Nordic report warns it could drive parts of northern Europe into far colder conditions if a major Atlantic ocean current collapses.

Greenland, Norway and Sweden could experience significantly colder climates as the planet warms, according to a new report by the Nordic Council of Ministers that examines the risks linked to a possible collapse of the Atlantic Meridional Overturning Circulation (AMOC).

The report, A Nordic Perspective on AMOC Tipping, brings together the latest scientific evidence on how global warming is slowing the AMOC—one of the world’s largest ocean circulation systems, responsible for transporting heat from the tropics to the North Atlantic. While a full collapse is considered unlikely, the authors warn that it remains possible even at relatively low levels of global warming, with potentially disruptive consequences for northern countries.

The Reversal

If the circulation were to weaken rapidly or cross a tipping point, the report notes, northern Europe could cool sharply even as the rest of the world continues to warm. Such a reversal would have wide-ranging effects on food production, energy systems, infrastructure, and livelihoods across the Nordic region.

“The AMOC is a key part of the climate system for the Nordic region. While the future of the AMOC is uncertain, the potential for a rapid weakening or collapse is a risk we need to take seriously,” said Aleksi Nummelin, Research Professor at the Finnish Meteorological Institute, in a media statement. “This report brings together current scientific knowledge and highlights practical actions for mitigation, monitoring and preparedness.”

A climate paradox

The AMOC plays a central role in maintaining the relatively mild climate of Northern Europe. As global temperatures rise, melting ice from Greenland and increased freshwater input into the North Atlantic are expected to weaken this circulation. According to the report, such changes could reduce heat transport northwards, leading to colder regional conditions—particularly during winter—even under a globally warming climate.

Scientists caution that the impacts would not simply mirror gradual climate change trends. Instead, an AMOC collapse could trigger abrupt and uneven shifts, including expanded sea ice, stronger storms, altered rainfall patterns, and rising sea levels along European coastlines. Some of these impacts would occur regardless of when or how quickly the circulation weakens.

The report also highlights global ripple effects. A slowdown of the AMOC could shift the tropical rain belt southwards, with potentially severe consequences for monsoon-dependent regions such as parts of Africa and South Asia, underscoring that AMOC tipping is not a regional concern alone.

Calls for precaution and preparedness

Given the uncertainty surrounding when—or if—the AMOC might cross a critical threshold, the report urges policymakers to adopt a precautionary approach. It stresses that any additional global warming, and prolonged overshoot of the 1.5°C target, increases the risk of triggering a collapse.

Key recommendations include accelerating emissions reductions, securing long-term funding for ocean observation networks, and developing an early warning system that integrates real-world measurements with climate model simulations. The authors argue that such systems should be embedded directly into policymaking to enable rapid responses.

The report also calls for climate adaptation strategies that account for multiple futures—including scenarios in which parts of Northern Europe cool rather than warm. It emphasises that AMOC collapse should be treated as a real and significant risk, requiring comprehensive risk management frameworks across climate, ocean, and disaster governance.

Science driving policy attention

The findings were developed through the Nordic Tipping Week workshop held in October 2025 in Helsinki and Rovaniemi, bringing together physical oceanographers, climate scientists, and social scientists from across Nordic and international institutions. The initiative was partly motivated by an open letter submitted in 2024 by 44 climate scientists, warning Nordic policymakers that the risks associated with AMOC tipping may have been underestimated.

By consolidating current scientific understanding and translating it into policy-relevant recommendations, the report aims to shift AMOC collapse from a theoretical concern to a concrete risk requiring immediate attention.

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Science Is Talking – Why Aren’t We Hearing?

Why the world still struggles to communicate science, and how researchers, journalists, and
institutions can rebuild a broken chain

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Have you ever listened to an expert discuss their work and felt like they were speaking a completely different language? You’re not alone. Scientific breakthroughs have the power to shape our health, environment, and future, yet they often remain locked behind a wall of jargon and complexity, failing to reach the public or the policymakers who write our laws.

This communication breakdown creates a “broken chain of knowledge,” with crucial information stuck at its source. The path from a scientific discovery to public understanding and sound policy is fraught with obstacles, from the culture inside the lab to systemic barriers in government.

Let us look at the most significant reasons for this disconnect. By understanding the challenges from the perspectives of scientists, journalists, and policymakers, we can begin to see how we might mend the chain and ensure that knowledge flows to where it’s needed most.

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The First Barrier Isn’t a Wall, It’s a Mindset

The communication problem often begins not with external hurdles, but within the culture of science itself. Before a single word is spoken to the public, an internal mindset can prevent scientists from effectively sharing their work. Some researchers operate with what former Indian minister Jairam Ramesh calls a “high pad” mentality, believing their specialized knowledge places them above the need for public engagement.

As Ramesh recently points out at the Science Journalists Conference of India, Ahmedabad University, this attitude is a primary barrier: “Too often I find scientists sitting on a high pad thinking that they have a better knowledge than the rest of the people… they speak in jargon they speak in their own language and they are really appealing to the community and not necessarily to the non-scientific community.”

Dr. Abhijit Majumdar of IIT Bombay acknowledges that scientists are often poor communicators — but he stresses a deeper issue: “Before learning how to communicate, scientists must first appreciate the need to communicate with the general public.” That awareness, he says, is still lacking in many settings. Experts note that this gap persists for two key reasons. The first is mindset: a cultural tendency to work in isolation — an “ivory tower inside their own ego.” The second is Language: after years of specialization, many scientists use technical vocabulary without realizing it’s incomprehensible jargon to outsiders, effectively building a wall where they intend to build a bridge. Overcoming this internal culture is the first step toward unlocking the mutual benefits of communication.

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It’s Not ‘Dumbing Down,’ It’s a Two-Way Street

A fundamental misunderstanding of science communication is that it’s simply “dumbing down” complex work; in reality, it is a transformative, two-way exchange that can lead to deeper insights for the researchers themselves.

When scientists are challenged to explain their work to non-experts, they must distill complex ideas to their “’observable conceptual’ level.” This act of translation often forces them to see their own work from a new perspective, uncovering fresh insights. As Dr. Majumdar states, the benefits flow in both directions:

“It’s a two-way street, it is beneficial for the sides if we learn how to communicate.”

Furthermore, this process can generate questions from the public that are “much more superior” to those scientists typically receive from their peers, pushing their research in new and unexpected directions.

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A Scientist’s Silence Creates a Vacuum for Misinformation

In our modern digital world, many scientists are hesitant to speak publicly, “scared that one wrong use of the work can be taken out of the context,” potentially leading to professional backlash. While this caution is understandable, it creates a dangerous paradox.

When credible experts stay silent on a complex issue, they create an “information vacuum.” That empty space will not remain empty for long. It is inevitably filled by less informed, less qualified, or even malicious actors eager to become the spokesperson on the topic. The silence of experts, therefore, directly enables the spread of false narratives.

In an era with a “lot of misinformation,” the proactive solution is a strong partnership between cautious, responsible scientists and trusted journalists. This collaboration is the public’s best and most powerful defense against falsehoods.

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The System Itself Is Designed to Fail

Even when individual scientists are willing to engage, they are often crushed by systemic and structural barriers. The larger systems governing science and media are frequently not built to support public communication, a problem that is truly global in scope.

Studies reveal a stark reality. Nearly 46% of academics in one study had never communicated their findings beyond peer circles, with 80% citing a lack of time as a major barrier. A global survey of geoscientists found that while 90% believe they have a moral duty to engage, 87% identified a lack of funding as a key obstacle. This isn’t confined to one region; a study in Zimbabwe found nearly half of academics had never shared their research with public audiences.

In India, this is compounded by institutional support that suffers from “irregular funding” and offers little incentive for sustained engagement. Interestingly, a 2020 Pew Research survey found that 75% of Indians believe government investment in science is worthwhile, suggesting a public appetite for knowledge that the system is failing to meet.

Further straining the system is the inherent conflict between the clashing timelines of science and journalism. Science is slow, careful, and methodical, prioritizing peer review and accuracy. The news cycle is instantaneous and reactive, demanding immediate responses for a public hungry for information. This friction between a scientist’s verification process and a journalist’s deadline puts constant stress on the very relationship needed to bridge the knowledge gap.

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In Policy, There’s a Structural Wall Between Science and Law

Even when science successfully reaches the public, the final link in the chain—influencing policy—is often completely broken. In India, for instance, Jairam Ramesh describes a profound structural disconnect between the nation’s scientific community and its lawmakers.

He explains that Members of Parliament receive their information almost exclusively from “government bodies” and “ministries,” not from the independent scientific institutions that house the country’s experts. This has led to a glaring absence of science-informed debate on some of the most critical issues facing the nation, including:

  • GM crops
  • Nuclear policy
  • The increasing frequency of landslides and earthquakes

Global warming and its impact on agriculture, health, and energy

To fix this, Ramesh proposes that India’s scientific academies must take a more “active role.” Instead of relying on individuals, these institutions should consolidate a “collective view” from the scientific community and present it directly to legislators, providing an authoritative voice that is much harder for policymakers to ignore.

Building the Bridge, Together

Mending the broken “chain of knowledge” is not a simple task, nor is it the responsibility of a single group. It requires a collaborative effort from scientists who see communication as a duty, journalists who build trust and provide context, and institutions that create systems that reward and support public engagement.

Breaking down these barriers is a critical responsibility for any society that wishes to be guided by evidence and shared understanding. By strengthening every link in the chain—from the lab to our laws—we can build the bridge to a future shaped by insight and reason. If knowledge is power, how can we each help ensure it flows to where it’s needed most?

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Climate

A Green Turn with Gaps: India’s Budget Backs Clean Tech but Skips Climate Adaptation

India’s Budget 2026–27 doesn’t shout climate ambition—but it hardwires it into clean manufacturing, carbon capture and energy supply chains, quietly reshaping the country’s green economy from the inside out.

Dipin Damodharan

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Clean Energy, Carbon Capture—and a Quiet Omission: Reading Budget 2026–27 Through a Climate Lens
India’s Union Minister for Finance and Corporate Affairs, Nirmala Sitharaman along with the Minister of State for Finance, Pankaj Chaudhary as well as her Budget Team of the Ministry of Finance before presentation of the Union Budget-2026 at Parliament House, in New Delhi. Image credit: PIB

India’s Union Budget 2026–27 may not carry a standalone climate chapter, but its green intent runs deep through the fine print. From carbon capture and battery storage to critical minerals and clean manufacturing, the budget signals a strategic shift: climate action is no longer framed as an environmental add-on, but as industrial policy and economic risk management rolled into one.

Presented by Finance Minister Nirmala Sitharaman on February 1, 2026, the budget places clean energy and climate-aligned manufacturing at the heart of India’s growth narrative. With a GDP growth target of around 7 percent and a sharp focus on fiscal discipline, sustainability is being embedded into supply chains, cities, transport and finance—quietly but deliberately.

Carbon Capture Takes Centre Stage

The most striking climate-linked announcement is the Rs 20,000 crore allocation over five years for Carbon Capture, Utilisation and Storage (CCUS), aimed at hard-to-abate sectors such as power, steel, cement, refineries and chemicals. For the first time, industrial decarbonisation is being backed at scale through public finance, signalling recognition that renewables alone cannot carry India’s net-zero journey.

As Arunabha Ghosh of CEEW notes, the budget’s “prioritisation of carbon capture, utilisation and storage across power, steel, cement, refineries, and chemicals” places these sectors squarely at the centre of India’s long-term climate pathway. This marks a decisive move from aspiration to infrastructure.

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Building the Clean Energy Ecosystem

The energy transition is supported by coordinated allocations across key ministries: Rs 32,915 crore for New and Renewable Energy, Rs 29,997 crore for Power, and Rs 24,124 crore for Atomic Energy. Customs duty exemptions have been extended to lithium-ion cells used in battery energy storage systems, inputs for solar glass manufacturing, and nuclear power project imports till 2035.

Aarti Khosla of Climate Trends captures this shift succinctly: “Coupled with the exemption given to battery manufacturing, VGF for BESS and grant to CCUS, the focus of the government is rightly tilting towards building an energy transition ecosystem.” She adds that continued reforms in power distribution could bring “360-degree improvement in India’s green energy supply chain.”

At the household level, the PM Surya Ghar Muft Bijli Yojana receives a major boost, reinforcing decentralised clean energy as a pillar of inclusive growth. Rooftop solar is increasingly being positioned not just as a climate solution, but as a competitiveness tool for small businesses and urban households.

Supply Chains, Not Just Solar Panels

Rather than headline-grabbing renewable capacity targets, Budget 2026–27 leans into industrial resilience. Duty exemptions for critical minerals processing equipment, solar glass inputs, and battery storage components underline a focus on domestic value addition.

Energy analyst Duttatreya Das of Ember observes that while there are “no big-ticket announcements for renewables,” the continued duty exemptions and manufacturing reforms are expected to “quietly strengthen clean energy supply chains.” This reflects a broader policy philosophy: competitiveness before capacity, foundations before scale.

Rare Earth Corridors and incentives for mineral-rich coastal states further indicate a push to secure upstream inputs essential for EVs, batteries, wind turbines and electronics—areas where geopolitical vulnerabilities are growing.

Clean Mobility and Greener Cities

Sustainability also shapes transport and urban planning. The budget proposes 20 new national waterways over five years, aims to double the share of inland and coastal shipping by 2047, and identifies seven high-speed rail corridors as environmentally sustainable growth connectors. Municipal finance incentives—such as Rs 100 crore support for cities issuing large bonds—open space for green urban infrastructure, including pollution control and climate-resilient services.

Labanya Prakash Jena,Director, Climate and Sustainability Initiative, highlights that such incentives can catalyse “green municipal bonds, particularly for pollution control and urban environmental projects,” linking fiscal reform directly with urban sustainability.

The Gaps That Remain

Despite these advances, the budget remains notably silent on climate adaptation. Heat stress, floods, water scarcity and climate-resilient agriculture receive no scaled-up fiscal roadmap. Vibhuti of IEEFA points out that while support for decentralised renewables and bioenergy has increased, spending on transmission and energy storage has stagnated or declined—areas that are “not optional but indispensable” for a high-renewables grid.

The absence of strong EV demand-pull measures and limited risk-sharing instruments for private capital also signal unfinished business in India’s clean transition.

A Budget of Signals, Not Slogans

Budget 2026–27 is not a climate manifesto. Instead, it is a signal budget—one that rewires incentives, de-risks clean manufacturing, and treats decarbonisation as an economic strategy rather than a moral appeal. Its strength lies in industrial tools and fiscal realism; its weakness, in adaptation and social resilience.

Whether this quiet green turn translates into measurable emissions reductions and climate resilience will depend on execution, state capacity, and private investment. But one thing is clear: India’s clean-tech transition has now entered the core of its economic planning.

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