AI More Suited To Supplement Human Action Rather Than Replacing It: Economic Survey 2025

The Economic Survey 2024-25 has highlighted that while artificial intelligence (AI) has made remarkable advances, it remains "more suited to supplement human action rather than be a total replacement for work performed by them.".

The report demystifies AI’s capabilities, particularly generative AI models, emphasising that their functioning is primarily statistical and lacks true intelligence.

The survey explains that "to respond to a user’s query, the data analysis performed by the model is essentially a game of ‘guess the next word’" rather than true comprehension.

AI models process text "by calculating probabilities based on the user input text", making them a highly complex version of an autocomplete function rather than independent decision-makers.

AI’s Limitations in Decision-Making Fields

The report underscores AI's limitations in critical fields such as healthcare, education, marketing, and the judiciary.

For instance, in education, AI-based grading tools may evaluate essays based on grammar and structure but fail to appreciate "the value brought by creativity, originality, and critical thinking expressed in the content.".

Similarly, in judicial decision-making, the survey warns that AI lacks the nuanced human judgment necessary for complex cases, stating that "judgments passed in courts are much more than simple prediction tasks and are a product of personal experience combined with domain-specific knowledge, the former of which AI lacks.".

AI as an Assistive Tool, Not a Human Replacement

The survey cites Oxford University AI expert Michael Wooldridge as suggesting that Large language models, despite their dazzling appearance of human-like competence, are not ‘AI’.

Emphasising that while the LLMs can perform logical reasoning and problem-solving, their extended capabilities are limited.

"Anything additional expected from these models must be explicitly coded into them, which is very different from what is traditionally considered ‘intelligent’. To claim that machines are ‘learning’ is to assign the wrong label since these models use predictive and probabilistic statistics to generate an output," the survey added.

"Advancements in computer science may just as well address these concerns in the future," it said.

Despite these constraints, the Economic Survey acknowledges AI’s potential if deployed effectively.

It suggests that rather than replacing jobs, AI should be used to "augment the productivity of the workforce".

"However, in the meantime, just as machines are designed for specific tasks rather than universal application, AI functions as a tool tailored to particular purposes. This means it is more suited to supplement human action rather than be a total replacement for work performed by them," the report said.

Call for a Balanced Approach to AI Adoption

The survey calls on policymakers to take a measured approach, ensuring that AI "is utilized as what it is supposed to be—a tool" and not an indiscriminate replacement for human work.

By focusing on AI-driven augmentation rather than automation, India can leverage emerging technologies while preserving employment opportunities.

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