The global conversational AI market is growing at a rate of 24% per year and is expected to reach €35bn by 2030, according to experts. Photograph: Getty Images

At a start-up office in this Indian city, developers are fine-tuning artificial-intelligence (AI) chatbots that talk and message like humans.

The company, LimeChat, has an audacious goal: to make customer-service jobs almost obsolete. It says its generative AI agents enable clients to slash by 80 the number of workers needed to handle 10,000 monthly queries.

“Once you hire a LimeChat agent, you never have to hire again,” says 28-year-old co-founder Nikhil Gupta.

Cheap labour and English proficiency helped make India the world’s back office, sometimes at the expense of workers elsewhere. Now, AI-powered systems are subsuming jobs done by headset-wearing graduates in technical support, customer care and data management, sparking a scramble to adapt.

That’s driving business for AI start-ups that help companies slash staffing costs and scale operations, even though many consumers still prefer to deal with a human.

This account of the disruptive changes transforming India’s €243 billion IT sector is based on interviews with 30 people, including industry executives, recruiters, workers and current and former government officials. AI start-ups and tested voice and text chatbots were also visited that handle increasingly sophisticated customer interactions in human-like ways.

Rather than pump the brakes as the technology threatens jobs built on routine tasks, the country is accelerating, wagering that a let-it-rip approach will create enough new opportunities to absorb those displaced.