India's IT Sector Sees Largest Monthly Drop Since 2008 Amid AI Disruption Fears

India's IT sector experienced its steepest monthly decline in nearly 17 years in February, with the Nifty IT index falling 19.5%, erasing about ₹5.7 lakh crore in market value. Investor concerns over potential disruptions from generative AI tools, notably those launched by US firm Anthropic, triggered heavy selling across major IT stocks including Infosys, Coforge, and LTIMindtree. Infosys shares dropped over 20%, marking their worst monthly performance since 2013, impacting mutual funds and foreign institutional investors. The sector faces uncertainty over AI's impact on traditional revenue streams like application services and outsourcing.