Is AI hype cooling shaping job security for Indian IT workers

The AI Bubble's Reality Check Hits Indian Tech

Look, the AI party in the stock room isn’t as loud as it used to be. So, Indian tech stocks are slipping as the big AI boom in the US starts to cool down.

The Nifty IT Index is down over 1% today, and investors are blaming the wobble in American AI valuations. In the Indian market, these firms still rely on collaborations with US giants to grow. On top of that, a stronger US dollar is making life tougher. The Dollar Index has inched up by nearly 2% in the last three months. And that isn’t helping. Foreign investors are pulling out more often, even as local funds try to hold steady.

There’s more to the story: yesterday, FIIs sold around ₹3,263 crore, while DIIs stepped in with about ₹5,283 crore. Yet the overall trend stays down. It’s a sign that the FII playbook—sell when US techs look pricey—still works. And there aren’t clear triggers for a quick reversal. The market’s ability to surprise remains a big, unwelcome factor.

The Dollar Wind and Foreign Flows: Why Indian IT Is a Tug-of-War

So, here’s the thing: when the rupee weakens against the dollar, Indian IT firms pay more for imports and for debt priced in dollars. That squeezes margins just as a cooling AI craze pins down growth hopes. The effect isn’t just on profits; it reaches salaries, hiring, and the ability to invest in new tools.

Analysts say this isn’t a one-day storm. It’s a currency and capital-flow tug-of-war. Domestic investors are buying more, but not enough to offset the pull from abroad. The net drift is risk-off. tech stocks become a safer haven for cautious money, even if that means slower hiring and tighter budgets in Indian tech firms.

The Ripple for Everyday Indians

So, what does all this mean for your wallet and your job? If you or your family work in IT, you’ll feel it in hiring, raises, and project stability. Companies will be careful with numbers and timing. The rush to chase every shiny AI deal may slow, but the real winners will be firms that turn AI into reliable, ongoing value.

This isn’t just about charts. It’s about how your evening’s billable hours, your child’s future in tech, and your savings breathe in a world where AI hype cools, the dollar keeps rising, and foreign flows swing like a pendulum.

The coming weeks will reveal who can turn AI into steady, practical value—and who gets left holding the hype.