A parrot can produce human sounding speech and associate certain prompts with desired responses, but there's no internal process that actually understands the meaning of either the prompt or the response (other than a shallow connection of sounds to a specific thing, rather than understanding human language). You'll never be able to train a parrot well enough to have that process in the same way a human does. Our current terminology would be like calling parrots "artificial humans".
LLMs are still great tools for various tasks, they just shouldn't be categorized as AI.