India, Aug. 26 -- For decades, India's IT services industry grew on a relatively simple equation: more software projects meant more engineers, more billable hours, and more revenue. Artificial intelligence (AI) and automation are now beginning to reshape that equation.

A recent Reuters analysis, based on interviews with Indian IT executives and industry experts, points to a structural shift. Global enterprise customers are increasingly moving away from traditional time-and-materials contracts towards outcome-based models, where payments are linked to measurable business results rather than simply the number of people deployed or hours worked.

For India's USD 315-billion technology industry, this could weaken the long-standing connection...