India hails EU’s AI laws as model for global regulation

With the European Union giving a thumbs up to laws on artificial intelligence (AI), it has become the first to set up a precedent for other countries looking at coming up with laws governing AI. Experts in India are calling this a landmark legislation that sets a clear regulatory framework.

The act lays down rules and guidelines for specific risks associated with the use of AI in areas like biometric authentication, facial recognition, high-risk domains

Indian startups and companies conducting business in the EU or catering to EU clientele will need to adhere to the standards set forth in the Act.

Further, the act will increase the cost and compliance burden of these companies, according to the experts.

“The regulation will require Indian companies to adjust their AI systems to meet the prescribed standards, undergoing conformity assessments, and implementing risk management measures if they are in the higher risk categorization. The compliance costs and regulatory burden could be significant, especially for smaller firms,” said Somshubhro Pal Choudhary, Co-founder, Bharat Innovation Fund (BIF) – a deep tech-focused venture capital firm.

Though the act will require companies to assess their AI models to determine their risk classification, it also allows sufficient time for compliance, explained Jameela Sahiba, Senior Programme Manager-AI Vertical, The Dialogue.

“The act allows time for compliance, as it will come into force twenty days after its publication in the official journal and will be fully applicable 24 months thereafter,” she said.

Further, the Act’s support for innovation through regulatory sandboxes can be leveraged by Indian startups to develop and test responsible AI solutions before market entry, she added.

Meanwhile, experts are of the opinion that the risk-based approach is perhaps applicable for the EU regions but each country will look at its own requirements.

When asked if this would be the case for India as well, Sahiba said, “While it will definitely offer lessons to India, it is important to note that India’s diverse socio-economic context, technological infrastructure, and regulatory framework differ significantly from that of the EU. In conversations so far around potential AI regulation, the Indian government has stressed upon a “user harms perspective” to AI regulation.” Business Standard