Artificial Intelligence (“AI”), which has been the talk of the town lately, has seen rapid advancements at both a global level and in the Indian landscape. Currently, AI is on everyone’s tongue, with an increased focus on AI safety and the launch of new institutes and regulatory frameworks. India itself is developing a comprehensive Regulatory Framework for Artificial Intelligence, and the Ministry of Electronics and Information Technology (“Meity”) will unveil its initial draft in the upcoming months. The main aim of this new legislation is to harness AI for economic growth and address potential risks and harms associated with AI. This will be a seven-pillar policy including India AI Compute Capacity, India AI Innovation Centre, India AI Datasets Platform, India AI Application Development Initiative, India AI Future Skills, India AI Startup Financing, and Safe & Trusted AI. Recently, there have been a lot of legal developments in the Indian digital realm, like the proposed Digital India Act 2023 released by Meity, Digital Competition Bill, 2024 and the enactment of the Digital Personal Data Protection Act, 2023 ("DPDP Act").
This article will examine the issues related to AI in Big Tech companies, start-ups and the healthcare sector. Further, this paper will look at AI regulations in different national jurisdictions to consider the extent of AI regulations needed in India.
Background
The task for the development of AI regulations in India started with NITI Aayog when it released the National Strategy for Artificial Intelligence #AIForAll strategy in 2018 which focused on the need for AI research and development in five sectors including healthcare, agriculture, education, smart cities & infrastructure, and smart mobility & transformation. After that, NITI Aayog 2021 released Part 1 - Principles for Responsible AI, and Part 2 - Operationalizing Principles for Responsible AI. Additionally, India has enacted the DPDP Act which will regulate some privacy concerns related to AI platforms. Aside from that, India is also a member of the Global Partnership on Artificial Intelligence (“GPAI”). India’s AI landscape is evolving continuously and without any comprehensive AI regulation, it would be difficult for India to compete with other AI-leading countries worldwide.
AI Systems Regulation in Big Tech and Start-Ups
The famous Libertarian Commentator Gurucharan Das stated that “India grows at night, when the government sleeps.” He meant by this maxim that Indians are among the most innovative people in the world until their government gets involved. We need AI regulation for Big Tech Companies & start-ups to the extent that it doesn’t restrict their innovation and helps regulate risks generated by AI systems. Recently, the MCA has introduced a draft of Digital Competition Bill, 2024 which will regulate Systematically Significant Digital Enterprises (“SSDEs”) like Alphabet, Apple, Amazon, Meta, etc. This new law will prohibit SSDEs practising in Code Digital Services (“CDS”) from self-preferencing, anti-steering and tying non-essential services to the service being demanded by the user. Additionally, the SSDEs cannot cross-utilise data of the users collected from CDS for another service and also the non-public data of the users cannot be used to gain an unfair advantage to the SSDE’s service.
This new legislation would address serious concerns with respect to monopolistic practices by Big Tech Companies. However, it may lead to disturbing the growth of domestic start-ups by bringing them within its regulatory net, preventing their future growth. The government should revise the threshold required for categorizing SSDEs and make it start-up-friendly.
Further, MCA has proposed the Digital India Act which will regulate digital enterprises including AI platforms. Additionally, CCI (Competition Commission of India) is going to launch a Market Study on AI and Competition to examine the AI systems that will have significant pro-competitive potential, and competition concerns emerging from the use of AI systems. With this new Digital Competition Bill in place, the Indian market will see a significant adverse impact on the growth of domestic start-ups. Compliance burdens, especially for Big Tech Companies which disincentivize innovation and Research & Development (R&D), will be worsened by the real possibility of arbitrary decision-making power on CCI concerning designation of SSDEs, problems for data privacy and consumer choice, etc. Additionally, there is a chance of potential overlap with other laws like the new DPDP Act and the proposed Digital India Act resulting in regulatory arbitrage issues.
Moving ahead, Section 3 of the DPDP Act states that data which is made publicly available will not apply to the definition of personal data. For example, if a person shares some personal information on his or her social media platforms, that will not be considered as personal data. This provision will allow Big Tech Companies to use publicly available online personal data without consent for developing AI models. Certain provisions of the DPDP Act will be operationalized through specific rules notified by the government. Additionally, under the DPDP Act, the central government can exempt certain AI start-ups from following certain obligations for a certain period of time.
AI Systems Regulation in Health Care
Recently, AI has made tremendous advances in the global health sector, used in medical imaging, diagnostics, and personalised treatments. The demand for improved and more efficient healthcare services is increasing in developing countries like India largely due to growing populations. To fulfil this increasing demand India needs to put forth AI systems in its healthcare sector. India has multiple healthcare challenges concerning infrastructure, shortage of skilled healthcare professionals, growing burden of diseases, etc. Incorporating AI systems within healthcare, would likely reduce the burden on the healthcare system.
Recently, the Indian Council of Medical Research (“ICMR”) in October 2017 released the country's first National Ethical Guidelines for the Application of Artificial Intelligence in Biomedical Research and Healthcare to meet the rapid advances in research, science and technology. It includes the concept of Broad Consent, ethical issues vis-à-vis deception, review of multi-centric research by an ethics committee, and other issues related to public health research. While there is a need for incorporating AI in healthcare, it poses certain threats too. It collects data related to health and other personal information of the patient, to train its models and to provide accurate results. There are strong chances of data breaches and cybercrime with respect to collected data. In India, it has already happened in the CoWIN Date leak case wherein the personal information of hundreds of thousands of Indians who took the COVID-19 vaccine was leaked on a Telegram Channel. This personal information includes phone numbers, gender, ID card information, and date of birth and this information can be retrieved from Telegram simply by entering a person’s name. This data leak shows incompetence in India’s regulatory framework to not be able to protect its citizens' information. The new DPDP Act aims to revise these issues to protect individuals' digitally available personal data from cybercrime.
International AI Regulations
This past year has seen an increased focus on AI safety and the launch of new AI Institutes in the US, the UK, Singapore, and Japan. Additionally, the new European Union AI office was established under the European Union’s Artificial Intelligence Act (“EU AI Act”) which will focus on developing best practices for AI. The new EU AI Act will introduce a due diligence obligation in the development of AI systems, mechanisms to verify the correctness of the decision, and approaches to holding individuals accountable if the decision is incorrect.
In the US there is no special federal law to deal with AI, although there have been established several sector-specific AI agencies and organisations to address challenges arising from the evolution of AI. For instance, US Senators have recently introduced the Artificial Intelligence Environmental Impacts Act, 2024 wherein it will conduct a study on the environmental impact of AI in collaboration with the National Institute of Standards and Technology (“NIST”), and the Office of Science and Technology Policy (“OSTP”).
Moving further afield there are countries like Italy which have limited access to ChatGPT on the basis of the General Data Protection Regulation (“GDPR”) without even waiting for their AI Act to come into force. This shows that even new AI technology can come within the ambit of the regulatory framework that is already firmly in place.
While crafting regulations, governments should recognise that AI technologies are in the early stages of development, and over-regulating it in every instance could eventually lead to less innovation in technology and other countries would have a considerable lead.
Conclusion
In conclusion, the development and regulation of AI in India is at a pivotal stage. The government's efforts, including the upcoming seven-pillar AI policy and various reports by NITI Aayog, demonstrate a strong pledge to leveraging AI for economic growth while addressing the associated risks. Initiatives like the Digital India Act 2023, Digital Competition Bill 2024, and the DPDP Act lay the foundation for a comprehensive AI governance ecosystem. However, there are challenges particularly in balancing regulation with innovation, ensuring data privacy, and fostering a conducive environment for start-ups.
Further, it is vital for India to adopt a nuanced method that encourages AI innovation while implementing robust safeguards. This includes refining the thresholds for categorizing SSDEs, ensuring alignment between various legislations, and addressing sector-specific concerns, particularly in Big Tech companies, start-ups and healthcare. Collaboration between government, industry, and academia will be crucial in shaping AI policies that are both forward-looking and adaptable to the rapidly evolving technological landscape.
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