The dramatic rise of AI-aided ‘vibe coding’ could reshape India’s software development industry

‘Vibe coding’ is one such phrase. It’s a term that reveals more about the future of programming than its whimsical name suggests.

At its heart, vibe coding refers to an intuitive, exploratory and often non-linear way of building software. It is less about syntax, structure and specifications, and more about assembling technology based on feel, flow and immediate feedback.

The term borrows from creative fields like music and art, where creators often ‘go with the vibe’ to develop something that feels right, even if they don’t quite know how it works under the hood.

This is heresy to anyone trained in classical software engineering, where requirements are documented, systems are modelled and logic flows neatly. But in practice, vibe coding is closer to how many real-world systems are built, especially in the early stages of development.

You open a no-code or low-code platform, drag and drop a few modules, try out different integrations, copy a snippet from somewhere, ask an AI assistant to generate a form or an application programming interface, and tweak things until it works. It’s not always elegant, but it’s effective. And increasingly, it’s how a surprising amount of software is getting made.

To understand vibe coding, consider the archetype of a non-techie founder—someone with a bold business idea but no formal background in computer science. Ten years ago, this founder had two choices: either find a technical co-founder willing to work for equity (often harder than finding a unicorn in Bengaluru traffic), or hire a development agency and spend lakhs on an initial prototype that may or may not reflect the founder’s vision.

Today, founders can vibe-code their way to a working minimum viable product (MVP).

Imagine a chartered accountant launching a platform to help small businesses with GST compliance. She has no coding experience but is comfortable with spreadsheets and knows the workflow inside out. Using a no-code builder, she assembles forms to capture invoices, sets up rules for tax calculations and plugs in a document generator to produce GST returns. Whenever she gets stuck, she turns to an AI assistant: “How do I calculate CGST and SGST on a reverse charge transaction?" The AI responds with a formula, which she plugs in–and it works.

There’s no software design document. No architecture review. But within a few weeks, she has a functional platform that solves a real problem; one she can show customers and potential investors. That’s vibe coding.

Of course, it has limitations. Systems built this way can be hard to maintain, poorly optimized or riddled with hidden dependencies. But these are later-stage problems. In the zero-to-one phase of doing something new, vibe coding offers speed, flexibility and, importantly, creative agency.

What makes vibe coding particularly relevant now is its potential to transform the Indian IT services industry. For decades, India’s software services sector has operated on labour arbitrage and process rigour. The typical engagement starts with detailed specs, followed by months of offshore development, code reviews, testing cycles and multiple stakeholder meetings. Clients pay for predictability, not experimentation.

But this model is under pressure. Clients expect faster turnaround times, iterative development and more value. They no longer want just a digital roadmap, but a functional prototype by next week. In this scenario, vibe coding can be a competitive differentiator.

Indian IT firms are experimenting with AI-assisted development and no-code platforms. But to fully harness the power of vibe coding, they must also adopt a cultural shift. They need to empower small teams, treat AI tools as collaborators rather than novelties and embrace the messiness of early-stage development. They must move away from treating software like engineering and more like a craft: responsive, improvisational and ‘human.’

This change will not be easy. Traditional delivery models, billing structures and performance metrics in IT services are all geared for predictability and scale.

But vibe coding could push Indian IT to rethink how it delivers value. The emphasis will shift from perfect code to working solutions and from process compliance to product intuition.

India produces millions of graduates each year, many of whom lack formal programming training but are fluent in English, logic and digital tools. With AI coding assistants, these individuals can enter the world of tech creation through vibe coding.

Just as mobile phones bypassed landlines in India, vibe coding could help a new generation bypass the traditional path of software engineering. They won’t need to master data structures or compiler theory. They’ll need curiosity, comfort with experimentation, and a willingness to ask the right questions.

Some purists will scoff. But then, most of the world’s most popular software wasn’t built with elegance, but by iteration. In the end, vibe coding may not replace traditional software development. But it will supplement it in powerful ways, particularly in early-stage ventures, rapid prototyping and services looking to move faster. This might be just the vibe Indian IT services needs.

The author is co-founder of Siana Capital, a venture fund manager.