DAVOS, Switzerland, Jan 20 (Reuters) - Artificial intelligence is underpinning technology deals that Indian software services providers are competing for, as companies move from AI test deployments to large projects, Wipro CEO Srini Pallia said.
As budget constraints loosen, Wipro is bidding for several small AI deals alongside large- and mega-deals, Pallia said on the sidelines of the World Economic Forum's annual meeting in Davos, Switzerland, without providing details.
"We'll go after both (small and large deals) because different clients, different industries, and different markets are at different maturity stages," he told the Reuters Global Markets Forum.
Pallia acknowledged intense pricing pressure as AI compresses delivery timelines and team sizes, but predicted there will be more small deals due to AI.
India's IT sector, which represents about $283 billion in annual revenue, was hit for several quarters by corporate cuts to technology spending as clients focused only on essential or cost-cutting initiatives amid geopolitical turmoil and macro uncertainties.
Enterprise AI spending is moving from experimentation to accountability, and Wipro offers both AI consulting and IT services for this transition, he said.
"For our clients, 2025 was more about deploying AI, proof of concepts, and bringing productivity benefits. That's dramatically changing in 2026 because the boards and the CEOs are asking them where the return on investment is," Pallia said.
Pallia did not expect tech budgets to dramatically increase, but said clients are optimizing spending and adopting cost-saving technologies.
AI-assisted software development will cost about 25% less, with significant productivity gains in coding and testing, he said. That will translate to "new and more projects, (and is) why IT budgets are not going to shrink in the long run," he said.
Wipro in 2023 launched a three-year plan to invest $1 billion to advance its AI capabilities.
(Join GMF on LSEG Messenger for live interviews: )
(Reporting by Divya Chowdhury in Davos and Haripriya Suresh in Bengaluru; Editing by Cynthia Osterman)
