Welcome to the India Today and Business Today studios here at the World Economic Forum. You're watching our continuing coverage, the Davos Brainstorm 2026. And now with me on our day one here is Dr. Anish Shah, the group CEO and the managing director of the Mahindra Group. Thank you very much for coming in. It's been day one, and we've had several guests come in giving us a sense of what they're seeing. So I want to begin by getting your sense about the mood in Indian CEOs and perhaps amongst the global ones that you've been interacting with with regard to the business world in this particular moment in time when trade disruptions continue.
It's first a pleasure being here. It's always great being back at Davos. The mood right now I would say is better than what I expected. Given the geopolitical challenges as well as supply chain challenges, I would have expected a little more of a somber mood, but what's happened is a number of CEOs have gotten used to that now and are focusing on what is in their control. Yes, there are challenges around. If I look at our example, we've gotten better at addressing them. COVID in fact helped as well. There's a silver lining to COVID in that sense, which is a semiconductor crisis created a much more resilient supply chain for us and a much more resilient set of leaders that could tackle those challenges. We went through that again in rare earths and we continue to get those challenges, but we've continued to be on a growth trajectory. So I would say India is more optimistic at this point than many other parts of the world. And that's also driven by the strength of the Indian economy right now, and we are seeing that very strong at this point in time, and that will clearly help all the Indian companies. But there is clearly a level of concern around what's happening and what surprises might come up almost every day and how do we address the surprises? The list of surprises doesn't cease. But since you spoke about resilience, I want to your sense about the American economy. A lot of people expected the tariff-related disruptions that they are themselves causing to tank the American economy, to use a euphemism. That hasn't happened. The sense seems to be that the AI investment boom has filled in and that is what is driving both the market cap of many companies as well as economic growth. Is that an assessment that you share as someone who understands the mood of business? America is a very strong economy. It always has. So I would be very hesitant to write that off in any form, regardless of AI. I think the American economy will withstand potential shocks as well. And in some ways, what is being done is also to strengthen the American economy in the medium to longer term. So that's one perspective. AI clearly has provided a boost, and one can argue whether that's a bubble or not, but companies are looking at them saying, 'I can't be left behind. Therefore, I have to invest.' If I think about it from the perspective of a user of AI and I hear this from various CEOs who are users or in manufacturing, the hype today is greater than reality. But the longer-term view on AI is possibly more positive than many would think because AI is transformative and will make a meaningful impact. We've done a lot in AI across multiple businesses, multiple areas, not just on productivity, on improving quality, on improving uptime in plants, improving energy efficiency, and AI can make a huge impact in all of those areas. I also do not agree as much with the fact that AI will cause jobs to go away because we've seen various technologies over many years that have caused many jobs to go away, but other jobs have been created. And you can just look at life around you right now and come up with many ideas. The phone that you're holding in your hand has replaced so many gadgets and devices. And all of those factories were shut down because they were not making as many cameras anymore, or just a list of possibly 50 to 70 devices that the phone has replaced. So technologies have always done that. The challenge with AI is that it can possibly be faster, but at least again from an India perspective, I do see the growth in India being an important antidote to that and the fact that we have to focus on reskilling. And we have to make those commitments that as we save in AI, we reskill our associates and be able to offer them roles in other areas, and that helps continue to drive the growth.
You spoke about productivity. Can you tell us from the AI implementation in your group, have you seen productivity gains or do you feel that these productivity gains are around the corner because this is a question that a lot of CEOs are debating?
We have seen real productivity gains, especially in customer-facing applications. But productivity gains are a small part of the benefit of AI. What we've seen more is quality. So if we look at welding for example, welding testing was done in a destructive manner in a sense where you looked at the weld, had to destroy that part or component, and it was done every so many components. With AI, there's 100% testing for the right weld. And that creates a much better car. What does that mean? It creates a car that has less noise because you got the weld set up well, and it's a much better ride overall. And that's part of what is playing out in the quality that we deliver to our consumers. Second is uptime in plants. So we managed to increase uptime by 10 to 15%, and especially at a time when our plants are running full and we have wait lists, this helps add to us being able to get cars to the consumer.
Absolutely fantastic numbers on bookings of recent models. So again, we are thankful to our consumers. But I would give our team a tremendous amount of credit because the R&D that has gone into this is what is delivering such quality products today and we are seeing the benefits of that. So AI I think is a lot more than just productivity. It creates a better experience for the consumer as well. So there are a number of things. The big difference in AI versus other technologies is typically in the past you could have a technology expert come in and say, 'I will do this for you and this will save you money or this will improve customer experience.' In AI, it has to be the process owners that identify how they can use AI and work in partnership with the tech leaders. So we tell all our leaders that you have to be tech leaders first, because you got to understand technology and that's how you can see benefits from it. Consultant won't do it. You yourself have to do it. How much of the gains are cost optimization gains?
I'd say from our standpoint, a small fraction. The biggest impact we are seeing is on quality, uptime, on customer satisfaction that leads to greater metrics for lead generation and conversion of leads because even a small change in conversion of leads is something that reflects a better customer experience and a lot more revenue. So we see the biggest impact coming from these projects more than productivity.
Should a worker on the shop floor be worried?
No, because we had automation in plants for a very long time. Should they have been worried when robotics came in? Because that displaced a lot of workers as well, but we found different jobs, we found different opportunities, different ways to reskill them, and the growth has taken care of that as well.
That's a good point. Let's again turn to the macro focus and this is to do with India's exports and the continuing tariffs that the United States has imposed. As an industry leader, how much of a detrimental impact do you think it has made and would you be able to share how you yourself as a company are mitigating, trying to mitigate the impact?
So clearly there is an impact, and some industries we see it more than others. It does create a level of uncertainty as well, and in many places I can see very meaningful impact. From Mahindra Group perspective, we have a tractor business in the US and that has clearly been impacted. We continue to look at various options. We do have some assembly that is done in the US as well. But at this point, I'm fairly optimistic that we will get to a resolution on it. And that likely would be the best answer for everyone. That will also go towards strengthening the ties we have with the US. We see potentially an EU FTA around the corner, and as that happens, that hopefully creates more positivity for us to be able to close that with the US as well.
Absolutely. And you touched upon my next question that one of the big things would be a speedy signing, hopefully very soon by some indications, of the India EU FTA. 2025 was described by analysts, journalists, as well as the Prime Minister as a year of reforms. With all indication that as far as India's economy is concerned, 2026 should also be equally good if not better. We are days away from the Union Budget. But reform making is not limited to the budget. What would be top of mind for you in terms of your expectations from the government to keep up the pace that was picked up in 2025?
