As India charts a course to become an artificial intelligence (AI) powerhouse, the Union Budget for 2024-25 assumes crucial importance, building on the substantial foundation laid during the fiscal previous. With a focus on ethical safeguards, upskilling initiatives and startup support policies, the budget is likely to aim to strengthen the domestic AI sector for sustainable growth.
AI Ethical Practices: Governance and Regulation
Recognizing the potential biases that AI systems can inherit from non-uniform data distribution, the budget could highlight the need for regulations. Governance regulations to establish ethical standards for AI developers and companies. Taking a cue from the Digital Personal Data Protection Act (DPDP), the government will likely consider setting clear guidelines for meaningful use of personal data, protecting against malicious algorithms and deepfakes, Financial Express reported .
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Incorporating governance tools, such as map models, will likely be advocated to prevent the misuse of AI solutions. These short documents would summarize crucial information about the model’s use, intent, and performance, ensuring transparency and ethical use. Additionally, the creation of a regulatory body, drawing on industry experts, will likely be proposed to combat inconsistent use of AI and ethical violations.
Developing a Strategy for India’s Global AI Position
The AI industry, with an estimated annual growth rate of 30%, plays a pivotal role in propelling India towards its ambitious $5 trillion economic goal. Harnessing AI across various sectors promises substantial improvements, from reducing court backlogs and improving tax compliance to predicting disease risks and detecting fraud in government programs.
The budget provides a unique opportunity to implement public-private partnership (PPP) models, optimize infrastructure and focus on centralized data repositories, promoting completeness, trust and controlled access .
Anticipation for education and skills development in AI
Building on the momentum created in Budget 2023, the government could allocate resources to centers of excellence (CoE) in AI in educational institutions. These centers of excellence, created through significant spending, will foster partnerships between industry and academia, fostering interdisciplinary research and solutions in key areas such as health, agriculture, education and sustainable infrastructure.
By recognizing the need to increase education spending, the budget could improve AI-based job training. This will enable a wider workforce, including those from Tier 2 and Tier 3 institutes, to meaningfully contribute to citizen services through the application of AI.
Supporting AI startups: financial incentives and tax deductions
The National DeepTech Startup Policy (NDTSP), formulated in 2023, remains a key instrument to drive innovation and economic growth in the AI startup landscape. Despite the challenges of the global macroeconomic environment, AI startups have demonstrated resilience.
Expectations for Budget 2024-25 include financial incentives and tax deductions for AI startups. The positive impact of the Startup India initiative is recognized and further support is sought through measures relating to taxes, loss carry forward, investments and stock options for employees. Encouraging the adoption of AI across various sectors, along with funding schemes such as the Startup India Seed Fund Scheme (SISFS), is expected to boost the growth of AI startups, particularly those operating in tier 2 and 3 cities.
