India faces an AI-driven challenge to its labor market, impacting job quantity and quality for educated youth. The article proposes a strategic response to expand the middle class. It identifies three worker types that may thrive: AI complements, data generators, and those in essential human-centric services. Key actions include integrating AI literacy into curricula, simplifying regulations, and crucially, elevating the status and financial viability of labor-intensive service jobs through credentialing, public campaigns, and support for self-employment. India's response in the next five years is critical.