By Sai Ishwarbharath B

BENGALURU, Sept 5 (Reuters) - Generative AI is helping

India's top IT firm Tata Consultancy Services

accelerate development in the industry's fastest-growing niche

of engineering research and design, a senior executive told

Reuters.

TCS, which has clients such as Rolls Royce, Jaguar

Land Rover and Siemens, has seen product development

cycles for engineering-related clients quicken by as much as 20%

and expects further improvement, Sreenivasa Chakravarti, vice

president of internet of things and digital engineering, said on

Wednesday.

Generative AI has taken centre stage in the space and

clients are replanning budgets and product features, Chakravarti

said. He did not name any clients while referring to the

productivity improvements.

"It (generative AI) is used for code generation, testing and

quality (assurance) which are low-hanging fruits right now."

Engineering, research and design services, which include

technology support to hardware-oriented industries such as

self-driving and sustainability solutions for oil and gas

companies, contribute a sixth of the revenue in India's storied

$254 billion tech industry.

The niche was estimated to grow 7.5% in the fiscal year

2024, the fastest among all sectors, according to data from the

National Association of Software and Service Companies.

The IT industry body expects the engineering, research and

design space to nearly quadruple between 2023 and 2030 to as

much as $170 billion.

Apart from pure-play software services firms such as TCS,

Infosys and Wipro, the space also has

focussed players like Tata Elxsi, Cyient and

L&T Technology Services.

India's core software services have been facing

macroeconomic headwinds and technology sector growth is

estimated to have slowed as clients hold back spending.

Meanwhile, the engineering, research and design niche has

been heating up as large IT firms buy out peers.

Cognizant snapped up digital engineering firm Bulcan for

$1.3 billion in June and Infosys acquired German player in-tech

for $480 million this year.

(Reporting by Sai Ishwarbharath B; Editing by Mrigank

Dhaniwala)