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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 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.

Health

IITK Researchers Unveils Key Receptor Structure for Cancer and Respiratory Treatments

The team successfully visualized the atomic structure of CXCR2, a crucial human receptor involved in the progression of cancer and respiratory diseases

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GPCR Lab. Image credit: By special arrangement

Researchers from the Department of Biological Sciences and Bioengineering at the Indian Institute of Technology (IIT) Kanpur have made a path breaking discovery that could pave the way for new treatments for cancer and respiratory diseases. The team successfully visualized the atomic structure of CXCR2, a crucial human receptor involved in the progression of these diseases. Their findings, published in the prestigious journal Molecular Cell, offer a new perspective on targeting this receptor for therapeutic intervention.

CXCR2 is a key receptor in the immune system, involved in directing immune cells to infection and injury sites through interaction with chemokines—small signaling proteins. CXCR2’s role in inflammatory disorders and cancers such as chronic obstructive pulmonary disease (COPD), asthma, atherosclerosis, and pancreatic cancer makes it a promising target for new drugs.

Using advanced cryogenic-electron microscopy (cryo-EM), the IIT Kanpur researchers captured unprecedented details of the receptor’s “lock-and-key” mechanism, shedding light on how CXCR2 interacts with multiple chemokines. This discovery addresses a fundamental question in biomedical science about how a single receptor can bind to various chemokines and trigger biological responses. The visualization also opens up opportunities for designing novel therapeutics.

“Our findings provide a molecular blueprint for designing next-generation therapeutics that can precisely target CXCR2 and potentially reduce its role in cancer and respiratory diseases. By visualizing this receptor in its active state, we now have the opportunity to develop highly specific inhibitors that can disrupt its function, potentially leading to significant advancements in treatment strategies,” said Professor Arun Kumar Shukla, the lead investigator of the study at IIT Kanpur.

The research team at IIT Kanpur includes Shirsha Saha, Saloni Sharma, Manisankar Ganguly, Nashrah Zaidi, Divyanshu Tiwari, Nabarun Roy, Nilanjana Banerjee, and Ramanuj Banerjee. Their work also involved collaboration with experts from the University of Tokyo, Japan—Fumiya Sano, Hiroaki Akasaka, Takaaki Kobayashi, Yuzuru Itoh, Wataru Shihoya, and Osamu Nureki—along with Andy Chevigne from the Luxembourg Institute of Health.

This study was funded by the DBT Wellcome Trust India Alliance, Science and Engineering Research Board (SERB), Indian Council of Medical Research (ICMR), and LADY TATA Memorial Trust.

Building on this discovery, the IIT Kanpur team is now developing small molecules and antibodies aimed at targeting CXCR2. These therapeutics will undergo laboratory testing, followed by animal studies, bringing the team closer to offering innovative treatments for cancer and respiratory diseases. This achievement further underscores IIT Kanpur’s commitment to pioneering research that has the potential to revolutionize global healthcare and biomedical innovation.

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Society

Is India’s Clean Cooking Gas Model the Future for the Global South?

The Indian model, backed by smart subsidies and sustainable policies, provides a scalable solution for developing nations striving for clean cooking access

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Image by Aristal Branson from Pixabay

At the just concluded India Energy Week 2025 (February 11-14), India’s Union Minister of Petroleum and Natural Gas, Hardeep Singh Puri, chaired a Ministerial Roundtable on Clean Cooking, where India’s success in providing universal access to clean cooking gas became a key focal point. The Minister emphasized that India’s model for clean cooking gas is not only a success story but also a replicable blueprint for the Global South, offering solutions to nations facing similar energy access challenges.

“India’s clean cooking gas revolution is a game-changer,” said Puri. He pointed out the key factors behind this success: targeted subsidies, strong political will, the digitization of distribution networks by Oil Marketing Companies (OMCs), and nationwide campaigns to shift cultural practices towards clean cooking.

The session brought together representatives from Brazil, Tanzania, Malawi, Sudan, Nepal, and key industry leaders, including the International Energy Agency (IEA), Total Energy, and Boston Consulting Group (BCG). These nations, all striving to enhance energy access for their populations, were eager to learn from India’s achievements.

Under India’s popular government scheme Pradhan Mantri Ujjwala Yojana (PMUY– Prime Minister’s Lightening Scheme), beneficiaries receive LPG access at a highly affordable cost of just 7 cents per day, while other consumers can access clean cooking fuel at 15 cents per day. “This affordability has been a game-changer in driving widespread adoption,” added Shri Puri, underlining the pivotal role of subsidies in overcoming financial barriers to clean cooking.

International representatives shared their nations’ efforts to transition to clean cooking solutions. Dkt. Doto Mashaka Biteko, Deputy Prime Minister and Minister of Energy of Tanzania, outlined the country’s strategy to transition 80% of households to clean cooking by 2030, relying on subsidies and a mix of energy sources, including LPG, natural gas, and biogas. Despite this ambition, he noted challenges such as financing constraints, infrastructure costs, and the need for regulatory reforms to encourage private-sector participation.

Similarly, Dr. Mohieldien Naiem Mohamed Saied, Minister of Energy and Oil, Sudan, emphasized the need for private-sector involvement to overcome gaps in LPG supply, particularly as Sudan still imports much of its energy. He stressed the importance of encouraging local cylinder production and ensuring cost-effective imports to drive broader adoption.

Mary Burce Warlick, Deputy Executive Director of the IEA, recognized India’s success as a model that offers valuable lessons for other nations grappling with issues of affordability, access, and infrastructure. She emphasized the role of concessional financing and public-private partnerships (PPP) in scaling up clean cooking access. Addressing cultural acceptance and regulatory adjustments, such as tax reductions, were also highlighted as critical factors for large-scale adoption.

Rahool Panandiker, Partner at Boston Consulting Group (BCG), further underscored the effectiveness of India’s clean cooking transformation. He attributed the success to the strong political commitment, effective subsidy targeting, and robust public awareness campaigns. Panandiker also credited India’s Oil Marketing Companies (OMCs) for enabling last-mile LPG delivery through digital platforms, making adoption seamless. He also stressed the importance of refining the cylinder refill model to ensure sustained usage while balancing affordability with economic sustainability.

In addition to LPG, the roundtable explored the potential of alternative clean cooking technologies. Puri addressed the potential of solar cookers in expanding clean cooking solutions across the Global South. He highlighted that IOCL’s advanced solar cookers, priced at approximately $500 per unit, could be a viable solution, though the price point remains a challenge for widespread adoption. “Leveraging carbon financing and collaborating with the private sector can drive costs down and make solar cooking a viable alternative for millions,” he stated.

This initiative aligns with India’s broader efforts to diversify clean cooking options beyond LPG, further reinforcing its commitment to reducing reliance on traditional biomass fuels and cutting carbon emissions. The government’s focus on solar cooking options aims to ensure a more sustainable future for energy access, particularly in remote and underserved areas.

“The Indian model, backed by smart subsidies and sustainable policies, provides a scalable solution for developing nations striving for clean cooking access,” Puri said. He also stressed that achieving universal clean cooking access is not merely an economic imperative but a moral one, given the severe health and environmental impacts of traditional biomass cooking.

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Green Energy

India Strengthens Clean Energy Initiatives at India Energy Week 2025

These clean energy projects are part of India’s broader strategy to diversify its energy sources and strengthen its energy security while promoting sustainability

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Image credit: PIB

At the India Energy Week 2025, India underscored its commitment to a sustainable and clean energy future through several strategic partnerships and agreements. Minister of Petroleum and Natural Gas, Hardeep Singh Puri, highlighted the importance of these initiatives in driving India’s transition to a greener energy landscape.

A key development in the clean energy sector was the partnership between India’s public sector firm BPCL and Eco Wave Power of Israel, which aims to establish India’s first wave energy pilot project in Mumbai. The project will utilize wave energy converter technology, marking a significant step in the country’s exploration of renewable energy sources.

In the biofuel sector, BPCL also signed an MoU with the National Sugar Institute, Kanpur, to scale up the production of sweet sorghum-based bioethanol. This collaboration will help build capacity for both farmers and industry partners, supporting India’s drive to increase the share of biofuels in its energy mix.

These clean energy projects are part of India’s broader strategy to diversify its energy sources and strengthen its energy security while promoting sustainability. Through these initiatives, India is reinforcing its position as a key player in the global clean energy transition.

Minister Puri emphasized that these agreements are a testament to India’s commitment to securing affordable, sustainable energy and fostering international collaborations in cutting-edge energy solutions. These partnerships will help achieve India’s energy transition goals, ensuring a resilient and sustainable energy future for the nation.

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