This research paper will examine the double-edged effects of Artificial Intelligence on the Indian labour market by weighing the immense potential for increased productivity against the shockwave of 120 million jobs potentially at risk by 2030. Through a qualitative study of international and national documented cases in a desk research manner, the thesis reveals a pressing need for a \"Skill Mismatch Crisis\" coupled with a \"regulatory vacuum\" since current legislation such as the Factories Act and the Digital Personal Data Protection Act of 2023 neglect the challenges posed by algorithmic labour management practices, gig economy insecurity, and monitoring at the workplace. Analyze large-scale employment datasets (such as PLFS or EPFO) and online job vacancy data to measure shifts in job demand, wage polarization, and the \"displacement effect\" across different sectors., the paper points out how constitutionally entrenched equality and privacy rights may possibly be usurped against vulnerable categories. The paper propounds an aggressive three-legged policy initiative design for the Indian government toward a more equitable economic development through a massive upscaling program accompanied by comprehensive security provisions within the gig economy.