How AI exposure varies across Indian states: Kerala leads, UP and Bihar lag behind

Kerala, Haryana, Maharashtra and Tamil Nadu have the highest shares of workers in occupations where artificial intelligence (AI) is more likely to improve productivity than replace human labour, while Uttar Pradesh, Bihar, Jharkhand and Madhya Pradesh face a double disadvantage of lower AI exposure and fewer opportunities to benefit from the technology, according to a new study by the Great Lakes Institute of Management.

The October 2026 working paper, AI, Automation and India’s Workforce: Who Gains, Who’s Exposed, and How Policy Can Shape the Future, examines employment patterns across Indian states using labour force data from 2012 and 2025. It distinguishes between jobs where AI can complement human skills, occupations facing substitution pressure and work vulnerable to conventional automation.

The findings suggest that the impact of AI on India's workforce will depend not simply on how many jobs are exposed to the technology, but also on the nature of those jobs and the skills workers bring to them.

Kerala leads Indian states in AI-exposed employment

Kerala has the highest share of employment in AI-exposed occupations, at 42%, followed by Haryana at 37.3%, according to the report's state-level analysis. Madhya Pradesh, at 16.8%, has the lowest share.

However, exposure alone does not indicate whether workers are likely to benefit from AI or face displacement. The study finds that Kerala also has the highest share of workers in AI-complementary occupations, at 14.4% of state employment. Haryana follows at 11.5%, Maharashtra at 11.1% and Tamil Nadu at 10.7%.

These occupations include health professionals, teachers, scientists, engineers and managers, whose work requires judgement, expertise and responsibility that AI can support rather than fully replace.

The report identifies these four states as having the strongest existing base of employment in which AI could raise productivity.