India's AI Dilemma: Shaping Global Governance or Following the Lead?
As global powers race to set the rules for Artificial Intelligence, New Delhi finds itself at a crossroads — championing the Global South's interests or aligning with the US-led tech bloc for faster growth. The choice will define its technological future and geopolitical standing.
The Pre-requisite
To understand India's position on Artificial Intelligence (AI) governance, it is essential to grasp the key concepts, the timeline of global discussions, and the domestic institutional landscape. This background clarifies the strategic choices New Delhi faces.
(1) KEY TERMS
- Global South — A term for developing and less-developed countries, primarily in Africa, Asia, and Latin America, often denoting shared experiences and a desire for greater equity in the global system.
- Foundational Models — Large-scale AI models, such as GPT-4 or Google's Gemini, trained on vast data sets that can be adapted for a wide range of tasks. Control over these models confers significant economic and strategic power.
- Strategic Autonomy — A state's ability to pursue its national interests and make policy choices without being overly dependent on or constrained by other countries, particularly in critical areas like technology.
- Pax Silica — A term describing the United States-dominated global semiconductor supply chain. Joining this framework implies aligning with US strategic and technological priorities in the chip manufacturing sector.
(2) BACKGROUND & TIMELINE
The global conversation on AI governance has accelerated since 2023. India's participation and evolving stance are best understood chronologically.
- September 2023: The G20 New Delhi Leaders' Declaration, under India's presidency, calls for a pro-innovation regulatory approach and international cooperation on AI governance, setting an early tone for India's global stance.
- November 2023: The United Kingdom hosts the first AI Safety Summit at Bletchley Park. The discussion, dominated by developed nations, focuses heavily on long-term, catastrophic risks from advanced AI.
- May 2024: South Korea co-hosts a follow-up summit in Seoul. The scope broadens slightly, but the core agenda remains influenced by the concerns of major tech powers.
- February 2025: France hosts the third summit in Paris, continuing the momentum from Bletchley and Seoul.
- February 2026: India hosts the India AI Impact Summit 2026. New Delhi initially frames the summit to centre on the needs of the Global South, focusing on present-day harms, equity, and inclusion.
- July 2026: The United Nations convenes the first of a two-part Global Dialogue on AI Governance in Geneva (July 6-7), providing a multilateral forum for all member states to shape international norms.
(3) INSTITUTIONAL FRAMEWORK
Domestically, India's AI policy is driven by several key government bodies.
- Ministry of Electronics and Information Technology (MeitY): The nodal ministry for formulating national policies on IT and electronics. MeitY leads the 'IndiaAI' mission, approved in March 2024 with a budget of ₹10,372 crore over five years, which aims to foster a domestic AI ecosystem through public-private partnerships.
- Ministry of External Affairs (MEA): Responsible for shaping India's foreign policy and its stance in international technology forums. The MEA leads India's delegation at global AI dialogues and negotiates technology partnership agreements.
- NITI Aayog (National Institution for Transforming India): The government's premier policy think tank. Its 2018 'National Strategy for Artificial Intelligence' laid the groundwork for India's 'AI for All' approach, focusing on leveraging AI for socio-economic development.
The Main Story
India's approach to Artificial Intelligence is caught between two competing visions. One vision positions India as a leader of the Global South, advocating for an equitable and inclusive technological order. The other is drawn towards the economic and strategic benefits of aligning with the United States' technology ecosystem. This tension became apparent during and after the India AI Impact Summit in February 2026, and the choices made now will have long-term consequences for the nation's economy, society, and global standing.
What was India's original vision for AI governance?
In the run-up to the India AI Impact Summit 2026, New Delhi articulated an AI governance philosophy distinct from the discourse that dominated earlier global meetings. The summits at Bletchley Park (2023), Seoul (2024), and Paris (2025) were heavily focused on mitigating 'existential risks'—hypothetical, long-term threats from superintelligent AI. The Government of India, through its summit's framing, sought to pivot this conversation.
The stated objective was to centre the debate on the immediate, real-world harms and opportunities relevant to the Global South. These include algorithmic bias in welfare delivery, data sovereignty, job displacement, and the use of AI for public health and agriculture. This approach was rooted in India's 'AI for All' strategy, first outlined by NITI Aayog in 2018, which prioritises inclusive development and societal benefit.
Why is India now seen as shifting its stance?
Despite the initial framing, the focus of the February 2026 summit and subsequent policy signals indicate a strategic shift. According to analysis from researchers at the Centre for Communication Governance and the Aapti Institute, the policy momentum moved from Global South solidarity towards accelerating AI adoption and raising capital for AI development. This pivot was solidified by India's decision to join 'Pax Silica', the US-led semiconductor alliance.
The Ministry of External Affairs has presented this as a pragmatic move to secure access to critical technology and investment. As part of this alignment, India has reportedly agreed to adopt a 'pro-innovation' regulatory approach, which involves lighter regulation to encourage investment and rapid technological deployment. This move is seen by critics as compromising the pursuit of strategic autonomy, as it ties India's regulatory future more closely to the interests of the US tech industry.
What are the concerns with this 'pro-innovation' alignment?
This alignment has raised concerns among digital rights advocates that India might replicate the dynamics of the social media era, where regulatory efforts were often subordinated to the commercial interests of US tech firms. A primary apprehension is economic value extraction, where India serves as a large market for US-developed foundational models while the economic benefits accrue to foreign corporations. Despite its vast user base, India's own efforts to build globally competitive foundational models have been limited, and its semiconductor ambitions are currently focused on assembly and testing rather than higher-value fabrication.
A second major concern, highlighted in reports following the February 2026 summit, involves disproportionate harms. This includes the scraping of public data to train foreign AI models without equitable benefit-sharing, and the use of low-cost Indian labour for data labelling. These practices raise questions related to the fundamental Right to Privacy under Article 21 of the Constitution, as affirmed by the Supreme Court in the K.S. Puttaswamy (2017) judgment. The sanctioning of land for data centres, which has reportedly displaced local communities, underscores the potential for negative externalities without adequate regulatory guardrails.
Finally, critics argue that this alignment could lead to a loss of regulatory sovereignty. Adopting a framework designed to attract US investment may constrain India's future ability to enact robust laws on data protection and algorithmic accountability, especially as the US government has officially favoured a market-led approach over binding multilateral governance.
How does India's position compare internationally?
India's dilemma places it between the world's other major regulatory poles. The European Union, with its AI Act (enforced in phases from 2024), has established a comprehensive, risk-based legal framework. It categorises AI systems based on their potential for harm and prioritises fundamental rights. In contrast, the United States has pursued a sector-specific, market-driven approach, avoiding a single overarching law.
China has its own state-centric model, with regulations focused on content control, algorithmic transparency, and national security. India's current 'pro-innovation' tilt moves it closer to the US model. However, its position as a massive, data-rich developing economy means the implications of this choice are vastly different. The UN Global Dialogue in Geneva, which commenced on July 6, 2026, represents a crucial forum where these competing visions are being debated, and where India has an opportunity to reassert its stance.
The Way Forward
India is at a critical juncture in defining its technological trajectory. The UN Global Dialogue on AI in Geneva is not merely a diplomatic exercise; it is a forum where the foundational rules of the next technological era are being written. India's voice will help determine whether those rules favour incumbent tech powers or create space for emerging economies to build their own ecosystems. The central dilemma for policymakers is balancing the immediate benefits of foreign investment with the long-term goal of building a self-reliant and equitable digital ecosystem.
The likely trajectory will be a continued balancing act. The government will pursue foreign investment for its semiconductor and data centre goals while attempting to carve out policy space for domestic innovation through the ₹10,372 crore IndiaAI mission. A key milestone will be the anticipated Digital India Act, expected to be tabled in Parliament by mid-2027. This Act, which will provide the first statutory framework for AI regulation, will likely draw from the principles of 'privacy by design' articulated by the Justice B.N. Srikrishna Committee on data protection in 2018.
The outcomes of the second part of the UN AI Dialogue, scheduled for 2027, will further test India's ability to build consensus around its priorities. Economically, the path chosen will determine whether India becomes a true AI producer or remains a sophisticated consumer and back-office service provider. Societally, it will shape the extent to which AI systems are subject to democratic oversight and constitutional values. Ultimately, India's AI strategy will determine its geopolitical standing. A 'leading power' not only adopts technology but also shapes the norms governing it. An approach that prioritises public purpose and strategic autonomy could position India to lead a coalition of emerging economies, advocating for a more equitable distribution of AI's benefits.