China's optical-communication companies boost from AI infrastructure demand; India's software sector vulnerable to AI replacing programmers

China's optical-communication companies are seeing increased demand for hardware required to build out AI infrastructure, including lasers, optical fibers, and transceivers. A Guangzhou-based executive told Nikkei that 'Everything is in shortage.'

India's software sector faces a different challenge: the country lacks major players in AI infrastructure, models, or chips, and is vulnerable to growing use of AI in place of programmers, driving foreign investors to reduce their exposure to its stock market.

An investment adviser told Bloomberg that India's challenge is 'a terminal value story,' not simply an earnings miss — suggesting structural concern about long-term valuations rather than near-term profit declines.