In: Economics
India is a labour intensive country. There is a large population
at the diposal, well within working age. Also, the skilled labour
is increasing in the country.
In case technology starts taking place of humans, it will have a
strong impact on unemployment. It will definitely increase in short
term and hence the inflation will also go up. There will be more
and more people without work, and hence the soending capacity would
reduce. Production would also start declining in such a
scenario.
In the long run, government would take appropriate measures to tackle the problem of unemployment. It would make policies or might implement taxes to control the use of robots. So, in the long run, unemployment rate would likely to come down and hence the inflation rate as well.