According to the World bank, if developing countries such as India act quickly, AI could help them achieve in a decade what might have taken a century.
The report, released on Tuesday, stated that jobs in high-income countries are more than three times as likely to be at risk of automation by generative AI than those in low- and middle-income countries, where 4.5% of existing jobs are at risk, compared with 14.2% in high-income countries. At the same time, 16.2% of jobs in developing economies could see productivity meaningfully boosted by AI - close to the 18.7% expected in high-income countries. The greatest promise for developing countries lies not in replacing workers, but in amplifying what they can do.
AI Is More Likely To Boost Jobs Than Replace Them
"AI has thrown developing economies a lifeline, and they should seize it", said Indermit Gill, Senior Vice President and Chief Economist of the World Bank Group."They do not need large models or big data centers to reap its benefits. By adapting small, low-cost AI tools to local conditions, they can bring better medical care, education, judicial services and agricultural extension within reach of millions. But they must hurry: AI is spreading faster and is more context-specific than earlier general-purpose technologies like electricity and the internet. World Development Report 2026 shows how developing countries are responding-and succeeding."
The report describes AI as a potential growth engine for developing economies at a time when many of them are seeing their weakest growth in decades. But it also cautions that these gains are not guaranteed.
Fixing The Basics Before Chasing Frontier AI
Many countries still lack the basics needed to fully benefit from AI, including reliable electricity, internet connectivity, skilled workers, quality data and strong institutions, the World Bank highlighted. Without addressing these gaps, AI could widen the divide between rich and developing nations and increase inequality within countries, it said.
To avoid that, the report recommended a phased approach. Countries should first adopt AI tools that are already available, then adapt them for local needs, and only later invest in building advanced AI capabilities of their own, it said. The report warned that trying to replicate the most sophisticated AI systems too early could prove expensive and ineffective.
"The window to get this right is narrow," said Gaurav Nayyar, Director of the World Development Report 2026. "AI presents a once-in-a-lifetime opportunity to solve problems that have resisted solutions for generations. Developing countries that build the foundations now-power, connectivity, skills, and institutions-will be positioned to adopt and adapt AI for their people."
The report also spotlighted how AI is already being used across developing countries. The technology is helping doctors analyse medical images, supporting farmers with better crop decisions, improving business productivity and enabling governments to strengthen public services, including tax administration, disaster response, healthcare and education, it pointed out.
India's AI Opportunity
Rather than focusing on building massive AI models or investing heavily in data centres, developing countries could see meaningful benefits by deploying smaller, lower-cost AI systems tailored to local languages and local needs, the World Bank said.
AI adoption is already gaining traction among businesses, it noted. In a survey cited by the report, about one in five firms with more than five employees across countries including India, Kenya, Mexico, Nigeria and Thailand said they had recently used AI chatbots in their operations.
However, the World Bank warns that governments should ensure AI is deployed responsibly. It said countries should encourage responsible AI practices, apply existing laws to address harms where necessary and build public trust by protecting privacy and preventing bias in AI-powered decision-making.
The World Bank's findings also align with the Indian government's broader thinking on AI. Speaking in New Delhi on Tuesday, IT Secretary S Krishnan said AI should enhance human capabilities rather than replace them, adding that humans must always remain "in the loop".
He said AI could create new kinds of jobs, improve governance and help India move closer to its goal of becoming a developed nation over the next two decades.
Also read: India's IT Secretary Says Humans Must Always Remain In The Loop With AI
