“Explore India’s pivotal role in AI governance, addressing data bias, and fostering equitable advancements. Learn how businesses can balance innovation with responsibility to drive ethical AI leadership.”

In recent years, the world has rapidly embraced AI, transforming industries and reshaping everyday experiences. As one of the fastest-growing economies, India is emerging as a global leader in technology and AI adoption. The country’s AI market is projected to reach $17 billion by 2027, with an impressive annual growth rate of 25-30%. While many organizations view AI as a reliable driver of growth at both individual and organizational levels, others struggle with the challenges it poses, particularly data bias. A recent report suggested that 69% of the Indian companies are concerned about data bias while 55% trusting AI/ML and trying to increase their reliability on the AI market.

Data bias is a significant challenge in any system, but in AI, it demands even greater attention and action. When data used in AI systems is biased, it results in outputs that are skewed, discriminatory, or misinterpreted—particularly in critical domains such as finance, healthcare, and recruitment. The impact of AI bias extends beyond technical issues, influencing societal concerns like gender inequality. In response to this challenge, India has partnered with NITI Aayog to address these biases and promote the development of responsible AI. However, the real test lies in how effectively organizations implement these guidelines to ensure fair and ethical AI practices.

Responsible AI practises

The responsibility for addressing AI bias largely rests with companies rather than individual users. Organizations must take proactive steps, such as investing in ethical and robust frameworks, and training data scientists to understand ethical considerations and mitigate risks associated with AI. Collaboration with stakeholders—including academia and industry peers—is crucial to staying informed about best practices and advancements in the field.

India’s NITI Aayog has outlined guidelines for responsible AI, emphasizing integrity, security, inclusivity, and alignment with international standards like the European GDPR (General Data Protection Regulation). Beyond adhering to these guidelines, companies must recognize the unique dynamics of the Indian market, balancing local and international standards to create equitable and trustworthy AI systems that not only meet requirements but also foster customer confidence.

Learning from other International Regulations

Addressing data bias transparently and committing to responsible AI practices are crucial for building public trust and confidence in technology. By 2026, Gartner predicts that 50% of global governments will mandate the implementation of responsible AI practices, reflecting the growing recognition of AI’s transformative impact and the need for ethical oversight.

In India, the regulatory landscape is evolving rapidly, with significant measures like the Digital Personal Data Protection Act (DPDP). This act underscores critical principles such as consent, accountability, and transparency in managing personal data. It aims to balance the protection of individual rights with the lawful processing needs of organizations, ensuring ethical and equitable data practices.

As these frameworks take shape, Indian organizations must not only comply with emerging regulations but also take proactive steps to integrate these values into their AI systems. This involves adopting robust mechanisms for consent management, establishing accountability measures, and maintaining transparency throughout the data lifecycle. By aligning with both domestic regulations and global standards, India can lead in fostering responsible AI development, paving the way for innovation that is both ethical and inclusive.

India’s role in shaping AI governance is pivotal, reflecting its proactive stance in past international negotiations. Much like its leadership in climate change discussions, India has the opportunity to champion equitable AI governance by advocating for inclusion and representation from the Global South. However, as the country experiences rapid AI-driven growth, it becomes imperative to address the pressing issue of data bias to ensure advancements are fair, inclusive, and beneficial for all.

To tackle these challenges, businesses must prioritize reliability checks to identify and mitigate AI data biases. They should also evaluate their AI practices to align with ethical standards and global best practices. By adopting a collaborative approach that balances innovation with responsibility, India can position itself as a global leader in AI governance, setting an example of how technology can drive progress while upholding ethical and inclusive values.

Last week, I had the opportunity to engage in a thought-provoking discussion about the widely debated concept of ‘Multistakeholderism‘, a key topic within the Internet Governance community. The session, part of an ongoing program with the Internet Society, featured an open discussion where participants presented both pro and con arguments. The zoom virtual town hall format allowed for dynamic interaction between speakers and the audience, sparking insightful debates supported by facts and evidence on the strengths and challenges of the multistakeholder model.

During the discussion, I began to realize that while the multistakeholder model is often lauded for its emphasis on inclusivity, it does have its drawbacks. At its core, the model advocates for the involvement of a wide range of stakeholders—governments, private sector actors, civil society, technical experts, and others—in decision-making processes related to Internet governance. On the surface, this appears to be a democratic and inclusive approach. However, as the conversation progressed, it became clear that the model is not without its complexities. I’m reflecting on what I’ve learned personally from the discussion.

The “multistakeholder model” is often portrayed as a single solution, but in reality, it’s not a one-size-fits-all approach. Instead, it’s a flexible framework that enables diverse individuals and organizations to come together, exchange ideas, and build consensus. It’s akin to a well-organized orchestra: while each instrument brings its own sound, they work together to create a harmonious performance. The multistakeholder approach thrives on collaboration, adaptability, and the ability to draw on various areas of expertise to address complex global issues.

For instance, consider the process of designing a public transportation system. A top-down, government-only approach might miss critical insights from local communities, engineers, and environmental experts. In contrast, a multistakeholder approach brings together city planners, citizens, transportation experts, and environmentalists to develop a system that meets the diverse needs of the population. This approach is most effective in situations where decisions affect a broad range of people, require expertise from different fields, and demand legitimacy to ensure successful implementation. Since the 2005 World Summit on the Information Society (WSIS), stakeholders have widely endorsed multistakeholderism as the preferred approach for addressing Internet governance and other complex global challenges.

The idea of “inclusivity” often implies a balance of power among all stakeholders, but in practice, this balance can be difficult to achieve. The Internet, as a global and decentralized entity, doesn’t belong to any single individual or organization, and no one stakeholder group has full control over its operation or development. However, despite the intention to ensure broad representation, certain groups—especially those with more financial, technical, or political power—can dominate discussions, potentially sidelining less powerful voices. This raises questions about the true level of inclusivity that the model offers, and whether it can truly capture the diverse interests and needs of all who are affected by the Internet, especially marginalized or underrepresented communities.

A key challenge in defining multistakeholderism is that no clear, agreed-upon definition exists for who qualifies as a “stakeholder.” While the concept suggests that anyone with an interest in an issue should have a voice, it doesn’t explain how we select stakeholders or what makes someone legitimately part of the conversation. This lack of clarity leads to different groups using various, sometimes conflicting, definitions of who counts as a stakeholder—despite the fact that the legitimacy of the entire governance process depends on this definition.

For example, in Internet governance, we could consider every user a stakeholder, but how do we actually represent these users? Additionally, one person may be seen as representing multiple identities, such as geographic region, gender, or other aspects, but does that mean they truly represent everyone within those categories? For instance, does the involvement of one woman in a multistakeholder setting truly reflect gender representation? Similarly, does having one civil society representative mean the full complexity of civil society is represented? These questions highlight the complexities and limitations of the multistakeholder model in practice.

In conclusion, while the multistakeholder model is designed to be a collaborative and inclusive framework, its implementation often requires balancing competing interests, addressing power imbalances, and ensuring that all voices are heard and valued equally. This remains a dynamic and ongoing debate that calls for continued dialogue, open forums, and active participation, particularly from younger generations. The future of multistakeholderism depends on our collective ability to engage in these discussions and work towards more inclusive, transparent, and effective governance structures.

Addressing going concerns over data privacy and and the longstanding dominance of global IT giants in the cloud services domain, Bharat’s(India) central bank, Reserve bank of India(RBI), is reportedly gearing up to launch its own cloud services by 2025. The aim behind this excellent initiative is to enhance the country’s digital infrastructure and ensure the security of financial data as well. The project described as “first-of-its-kind initiative” objective is to decrease the reliance on the foreign cloud providers like the cloud platform will leverage solutions from domestic IT firms, offering alternatives to services like Amazon Web Services(AWS), Microsoft Azure, Google Cloud, and IBM Cloud and enhance control over critical financial infrastructure.

The RBI’s public cloud service plans were first announced in December 2022. The initial development is being led by Indian Financial Technology and Allied Services (IFTAS) in collaboration with private tech companies, with consultancy firm EY appointed as an advisor.The initial funding, amounting to ₹229.74 billion ($2.72 billion), will be sourced from the central bank’s asset development fund. Over time, financial firms will be invited to invest and acquire equity in the cloud service. The RBI has restricted bidding for the project to companies incorporated in India with prior experience in developing cloud-related solutions, underscoring its focus on localizing digital infrastructure for payments and financial data storage and processing, according to the report.

The RBI’s initiative to launch its own cloud services comes with both significant opportunities and challenges, especially given the scale of providing cloud infrastructure to the world’s most populous nation.

The ‘PROS’ includes:
Enhanced Data Sovereignty:The platform would guarantee that critical financial data is stored and processed within India, minimizing the risks linked to foreign data management.

Being self-reliant: By providing a local alternative, the RBI could challenge the dominance of companies like Google, Amazon, and Microsoft in India’s financial ecosystem. Building in-house capabilities would also help mitigate the risks posed by geopolitical tensions affecting foreign tech providers.

Domestic IT Firms growth platform:The project would create opportunities for Indian IT companies, driving growth and innovation within the country.

Improved Security and Control with Innovation: A central bank-controlled platform could provide enhanced security and ensure better regulatory compliance for critical financial data. By fostering competition, this initiative could drive innovation among both domestic and global cloud service providers.

Cost Efficient: In the long term, localized cloud services could help lower operational costs for Indian financial institutions compared to using international providers.

The ‘CONS’ includes:
Major amount of Investment: The project requires a significant upfront investment, with initial funding of ₹229.74 billion ($2.72 billion).

Cloud Technology and the challenges: Building a scalable and secure cloud service that rivals the infrastructure and reliability of global giants like Amazon, Google, and Microsoft is a considerable challenge. Moreover, Indian IT firms may face difficulties in acquiring the advanced expertise necessary to manage a national-level cloud platform capable of supporting India’s expansive financial system.

Adoption Challenges and costs: Many financial institutions are already dependent on global cloud providers, which may make them hesitant to transition to a new, untested local platform. Additionally, continuous investment will be required to stay ahead in the rapidly evolving cloud technology landscape while maintaining high security and uptime standards.

Monopoly factors: The RBI-managed platform could dominate the market, potentially stifling competition and limiting innovation. This could create a centralized ecosystem where fewer players control the landscape, reducing the incentives for both domestic and global providers to innovate or offer competitive services. In the long run, this lack of competition could lead to inefficiencies and slower technological advancements.

Scalability and roll out challenge: Considering India’s vast size and diverse financial ecosystem, scaling the platform to meet the needs of the entire sector could take several years to fully achieve. The process would involve significant time and resources to ensure the platform is capable of handling the complexities of India’s financial institutions, varying regional requirements, and growing data demands. This gradual rollout could delay the widespread adoption and effectiveness of the platform, posing a challenge in meeting the rapidly evolving needs of the financial sector.

RBI’s initiative to develop a localized cloud platform offers promising benefits for data security and the growth of domestic IT, aligning with the vision of Aatmanirbhar Bharat. However, the project faces considerable challenges, particularly in terms of technical complexity, financial investment, and adoption by financial institutions. While this move can enhance self-reliance and reduce dependence on foreign providers, successfully launching such a large-scale initiative would be a monumental achievement. Yet, the obstacles it presents must not be underestimated, as it requires careful planning and execution to meet the diverse needs of India’s financial sector.