AI Undermines Emerging Markets' Development Pathways

Analysis from Data Darbar warns that artificial intelligence is fundamentally disrupting the traditional economic development pathways that guided emerging markets for 50 years, undermining low-cost manufacturing and offshore services. The report cites robotics and generative AI advances—including Claude Opus 3 since March 2024—that are eroding labor arbitrage and pressuring major Indian IT firms, risking capital and talent concentration in advanced economies and widening global inequality.