MeitY’s advisory to Tech Companies on AI Products

The advisory from Ministry of Electronics and Information Technology (MeitY) states that all intermediaries or platforms are to ensure that use of Artificial Intelligence model(s) /LLM/Generative AI, software(s) or algorithm(s) on or through its computer resource does not permit its users to host, display, upload, modify, publish, transmit, store, update or share any unlawful content specified under Rule 3(1)(b) of IT rules will attract legal consequences.

The recent mandate for companies deploying AI and Generative AI models to obtain approval is set to have a profound impact on enterprises of all sizes in India. MeitY issued a notice on March 1 warning platforms that failing to comply could result in legal action.

Essentially, AI platforms need to label under-trial AI, seek approval from the government before deploying AI models deemed “under-testing” or “unreliable”, and obtain explicit consent from users before exposing them to such AI models.

As per experts, this advisory is untenable and impractical on multiple levels, if it challenged in court it will be thrown out. Moreover since it is an advisory, we are now left wondering if it is mandatory, the government has been extremely unclear.

Here's how this could affect small-scale and large-scale enterprises in terms of AI-based cybersecurity implementation, with a look at the pros and cons:

The positive side of Small-Scale Enterprises is

Enhanced Trust: Mandatory approval could enhance consumer and investor trust in small enterprises by ensuring that their AI systems are vetted for safety and security.

Improved Security Posture: It may push small enterprises to adopt higher cybersecurity standards, which can reduce the risk of data breaches.

Regulatory Support: The government may provide frameworks and support for compliance, potentially aiding small businesses in navigating the approval process.

The Negative side of it is :

Resource Constraints: Small enterprises may lack the necessary resources for compliance, leading to potential financial strain and distraction from core business activities.

Compliance Complexity: Understanding and navigating the new regulations could be challenging and might require hiring external consultants or legal help.

Innovation Dampening: The approval process could slow down innovation as small enterprises may hesitate to experiment with new AI technologies due to regulatory uncertainties.

Similarly, the Large-Scale Enterprises also raises deeper concerns like, if international competitors are not subject to similar regulations, Indian companies might find themselves at a competitive disadvantage.

Moving ahead, the goal of the mandate is to ensure responsible and ethical use of AI, but its success will depend on the implementation of the regulation and the support provided to businesses as they adapt to these changes.

Dr. Deepak Kumar Sahu Editor-in-chief- VARINDIA