Introduction

As Artificial Intelligence systems increasingly influence governance, finance, employment, surveillance, and everyday decision-making, India has taken a significant legislative step to define ethical boundaries for this powerful technology. The Artificial Intelligence (Ethics and Accountability) Bill, 2025, introduced in the Lok Sabha, seeks to establish a formal accountability framework to ensure that AI-driven systems remain transparent, fair, and aligned with democratic values .

This proposed law reflects growing concern over algorithmic opacity, bias, and unchecked deployment of AI in sensitive domains.

Need for the AI Bill

India’s rapid digital transformation has outpaced the evolution of regulatory safeguards around artificial intelligence. AI systems are now routinely used in areas such as credit scoring, recruitment, law enforcement analytics, surveillance, and public service delivery. While these systems promise efficiency and scale, they also introduce serious risks.

Key challenges that necessitated this bill include:

• Algorithmic Bias and Discrimination
  AI systems trained on skewed or incomplete datasets can reinforce social, economic, and gender biases, leading to unfair outcomes without clear accountability.
• Opacity in Automated Decision-Making
  Many AI-driven decisions lack explainability, leaving affected individuals with no clarity on how or why outcomes were reached.
• Expanding Surveillance Capabilities
  AI-powered surveillance tools raise concerns around proportionality, consent, and misuse, particularly in the absence of independent oversight.
• Absence of a Dedicated AI Ethics Authority
  Prior to this bill, India lacked a statutory body specifically mandated to review ethical violations, misuse, or systemic harm caused by AI technologies.

The Bill directly addresses these gaps by introducing enforceable obligations rather than voluntary guidelines.

Key Provisions and Framework

At the core of the legislation is the creation of an Ethics Committee for Artificial Intelligence, constituted by the Central Government. This committee is tasked with developing ethical standards, monitoring compliance, reviewing violations, and building stakeholder awareness.

Some of the most consequential provisions include:

• Mandatory ethical review for AI systems used in surveillance and critical decision-making, including law enforcement, employment, and financial services.
• Clear responsibilities for AI developers to disclose system purpose, limitations, training data sources, and reasoning behind decisions impacting individuals..
• Obligations to conduct regular audits to detect and mitigate algorithmic bias.
• A grievance redressal mechanism allowing affected individuals or groups to file complaints.
• Penalties extending up to ₹5 crore, suspension of deployment licenses, and potential criminal liability for repeat violations.

Impact on AI and Technology Ecosystem

If enacted, the bill will have wide-ranging implications across India’s technology and cybersecurity landscape.

• For Technology Companies and Developers: The legislation introduces compliance-by-design expectations. AI developers will need to integrate transparency, auditability, and bias mitigation into product lifecycles, increasing governance costs but also improving long-term trust.

• For Government and Public Sector Deployment: AI-driven surveillance and automated decision systems will face stricter scrutiny, reducing the risk of arbitrary or disproportionate use while reinforcing accountability in public administration.

• For Citizens and Civil Society: The bill strengthens individual rights by introducing explainability and formal complaint mechanisms, shifting AI governance from opaque automation to accountable decision-making.

• For India’s Global Positioning: The proposed framework aligns India with emerging global AI governance trends seen in the EU and other democratic jurisdictions, potentially enhancing trust in Indian AI products and services internationally.

Challenges and Area of Debate

While the bill is ambitious, several practical concerns remain:

• The effectiveness of the Ethics Committee will depend heavily on its independence, technical depth, and enforcement capacity
• Compliance obligations may be challenging for startups and smaller AI developers without proportional safeguards
• The bill leaves significant rule-making power with the executive, which will shape how rigorously the law is applied in practice

Balancing innovation with regulation will be critical to avoid slowing India’s AI growth while still preventing harm.

Future Outlook

The Artificial Intelligence (Ethics and Accountability) Bill, 2025 represents an early but important attempt to move India from principle-based AI governance to enforceable regulation. As AI systems become more autonomous and deeply embedded in national infrastructure, ethical oversight will shift from a policy debate to an operational necessity.

If implemented with transparency, proportional enforcement, and technical expertise, the bill could serve as the foundation for a broader AI governance framework covering safety, liability, and national security implications in the years ahead .