Logical (Critical) Reasoning Questions for CLAT | QB Set 91

Artificial Intelligence has moved from experimentation to enterprise adoption in under two years, with industry estimates projecting AI services revenues of $10–12 billion in FY26. This rapid expansion coincides with layoffs, automation, and the vulnerability of entry-level roles in India’s IT and BPO sectors, even as top tech firms integrate AI into workflows.

Alaganambi Welkin argues that much of what is being seen is “AI washing.” Retrenchments and restructuring are not primarily due to AI, but are being justified in its name. At the same time, transformation is real. Developers and engineers are adapting to AI tools that assist daily work. However, claims that AI will eliminate massive numbers of jobs or fully replace developers are considered far-fetched. What is occurring, according to him, is cost-cutting by multinational corporations being labelled as AI-driven.

Kishan Sundar views AI as transformational rather than disruptive. The industry earlier relied on labour arbitrage, growing by adding people. Now it is moving towards “intelligence arbitrage,” where GenAI enables growth without proportional staff increases. AI tools generate structured code, but production readiness still requires skilled assessment, refactoring, and contextual judgment.

Efficiency gains are visible across roles. Product managers can draft user stories faster. Testers and DevOps engineers are becoming more efficient. Teams of eight to ten may shrink to three to five. However, AI systems require monitoring, fine-tuning, and adaptation, creating new roles. Revenue per engineer is increasing, even if fewer people are needed per engagement.

Entry-level BPO and KPO jobs, being repetitive and process-driven, are more vulnerable. Agentic AI may automate end-to-end processes, reducing large headcounts significantly. In IT services, while coding time reduces, software development still involves coordination, communication, and complex interdependencies that AI alone cannot replace.

Global AI partnerships are described as growth strategies. In regulated sectors, auditability and traceability remain essential. Context engineering, domain expertise, and regulatory integration are becoming critical. India largely builds on foundational models developed elsewhere, focusing on services, integration, and execution. The industry is also shifting from manpower-based billing to outcome-based pricing.

The discussion concludes by highlighting the need for a just transition, including unemployment protections, credible skill certification, algorithmic transparency, and attention to environmental impacts from expanding data centres.

Q1. What is the primary argument made by Alaganambi Welkin regarding AI-related layoffs?

A. AI has already replaced most software developers in India.
B. Layoffs are mainly caused by AI-driven automation.
C. Companies are using AI as a justification for traditional cost-cutting measures.
D. AI has had no impact on the IT sector.

Answer: C

Q2. Kishan Sundar’s concept of “intelligence arbitrage” suggests that:

A. Companies will stop hiring employees altogether.
B. Growth can occur without a proportional increase in workforce.
C. AI eliminates the need for domain expertise.
D. Labour costs will increase due to AI adoption.

Answer: B

Q3. According to the passage, which category of jobs appears most vulnerable to AI automation?

A. Senior product managers
B. DevOps engineers
C. BPO and KPO roles involving repetitive tasks
D. Regulatory compliance specialists

Answer: C

Q4. The passage suggests that AI-generated code still requires human intervention primarily because:

A. AI cannot generate structured code.
B. AI tools are banned in regulated sectors.
C. Production-ready software demands contextual judgment and evaluation.
D. Developers refuse to adopt AI tools.

Answer: C

Q5. The discussion on a “just transition” in the passage mainly highlights concerns about:

A. Increasing salaries of AI engineers
B. The need for foreign investment in AI
C. Social protections, transparency, and environmental impact
D. Export restrictions on AI technology

Answer: C