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The Indian Union Budget for 2024, presented by Finance Minister Nirmala Sitharaman on July 23, has introduced a variety of measures aimed at stimulating economic growth, creating jobs, and providing relief to different segments of the population. In an effort to enhance disposable incomes and spur consumption, the government has revised the tax slabs under the new income tax regime. This includes an increase in the standard deduction by 50% to Rs 75,000, which is expected to save salaried employees up to Rs 17,500 annually. Such tax relief aims to provide more money in the hands of the middle class, potentially boosting consumer spending and thereby supporting economic activity. To address the pressing issue of job creation, the budget proposes a novel approach by offering one month's salary to new workforce entrants across all sectors. This initiative, expected to benefit approximately 2.1 crore youths, will be disbursed in three tranches, with an eligibility limit of Rs 1 lakh salary. This measure is designed to provide immediate financial support to young job seekers, thereby facilitating their entry into the workforce and reducing unemployment rates. Additionally, the government has announced loans of up to Rs 10 lakh for higher education in domestic institutions, which could ease the financial burden on students and encourage more individuals to pursue higher education. Complementing this, a scheme to provide internship opportunities in 500 top companies to 1 crore youth has been unveiled, aimed at enhancing employability and practical skills among the younger population. In a significant boost to the startup ecosystem, the budget abolishes the angel tax for all classes of investors. This move is expected to alleviate the financial burden on startups, encouraging more investments and fostering innovation. The abolition of this tax addresses a major concern for young startups, which often struggle with financial constraints and regulatory hurdles. This could lead to a more vibrant and dynamic startup environment, driving economic growth through entrepreneurship and new business ventures. The budget also focuses on making essential goods more affordable by reducing customs duties. For instance, the customs duty on gold and silver has been reduced to 6%, while the duty on mobile phones has been cut to 15%. These reductions are likely to lower the prices of these items, providing direct benefits to consumers. The reduction in gold and silver duties is particularly significant in a country like India, where these commodities hold cultural and economic importance. Specific regional allocations have been made to support the states of Andhra Pradesh and Bihar, which are governed by major NDA allies. This includes significant sops aimed at addressing developmental disparities and promoting regional growth. These measures reflect the government's strategy to ensure balanced development across different regions of the country, thereby fostering national economic integration. On the fiscal front, the government has decided to increase the Long Term Capital Gains tax from 10% to 12.5%. This measure aims to enhance revenue generation but could potentially deter investment. Investors might view this tax hike unfavorably, as it reduces the attractiveness of long-term investments. This could have implications for the stock market and the overall investment climate in the country. The budget also emphasizes substantial support for the agriculture sector, with an allocation of Rs 1.52 lakh crore. This investment is aimed at strengthening the agricultural infrastructure, improving productivity, and ensuring better income for farmers. The focus on agriculture is crucial, considering that a significant portion of the Indian population is dependent on this sector for their livelihood. Additionally, Rs 11,500 crore has been earmarked for flood control and irrigation projects, addressing critical infrastructure needs and mitigating the impact of natural disasters on agriculture. Another noteworthy aspect of the budget is the emphasis on nuclear energy as part of India's energy mix. This reflects the government's commitment to transitioning to cleaner and more sustainable energy sources, reducing reliance on fossil fuels, and addressing environmental concerns. The focus on nuclear energy is part of a broader strategy to achieve energy security and support the country's economic growth while minimizing environmental impact. Despite the various positive measures introduced in the budget, there are potential drawbacks and challenges. The increase in Long Term Capital Gains tax could deter investment, which might have long-term implications for market sentiment and economic growth. The success of job creation measures will depend on effective implementation and the ability to match job opportunities with the skills and aspirations of the youth. While the abolition of the angel tax is a positive step for startups, the overall ease of doing business and regulatory environment still pose challenges that need to be addressed comprehensively. Abhisht Chaturvedi is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Abhisht Chaturvedi (This image is generated by ChatGpt 4o, the publishers and the author are not responsibel for any inaccuracies in the depictions) IndexIndia's recent inclusion in JP Morgan's Emerging Market Bond Index (EMBI) marks a significant milestone for the country's financial markets. This move is poised to attract substantial foreign investments into India's government bonds, potentially reshaping its economic landscape in the coming months and years. Background and Significance of the Inclusion India's government bonds will gradually become part of JPMorgan's widely tracked EMBI starting from a specified date. The announcement, made several months earlier, set the stage for what is expected to be a substantial inflow of capital into India's economy. This inclusion is not just symbolic but practical, as it opens the doors for billions of dollars from index-tracking funds to flow into the world's fifth-largest economy. Projected Inflows and Market Response India anticipates approximately $2 billion in inflows from index-tracking funds around the inclusion date, with similar amounts expected monthly thereafter. This translates into a projected total of at least $20 billion over the next 10 months as India gradually reaches its maximum weight in the index.The market has already seen significant inflows from active fund managers and other investors since the announcement was made, reportedly, totaling $10.5 billion. This influx is nearly six times the inflows received during the comparable period from early 2021 to August 2023, indicating heightened investor interest and confidence in India's debt securities. Factors Driving Foreign Investor Interest Global investors are particularly attracted to India for several key reasons: High Growth Potential: India is seen as a high-growth economy, offering lucrative opportunities for investors seeking higher returns. Promise of Fiscal Prudence: The Indian government's commitment to fiscal discipline reassures investors about the stability and reliability of its financial policies. Currency Stability: The Indian rupee's relatively low volatility compared to other emerging market currencies enhances its appeal as a stable investment option. Inflation Management: The central bank, Reserve Bank of India (RBI), has pledged to keep inflation under control, further bolstering investor confidence. Geopolitical Tailwinds: India is seen as a geopolitical balancer against China. This is likely to help the country attract increasing amounts of foreign direct investments (FDI) over the next decade. These factors collectively contribute to making India an attractive destination for global capital, especially in the context of emerging market debt where stability and growth potential are highly valued. Impact on Currency and Financial Markets Large inflows of foreign funds typically influence the domestic currency. While the inflows are expected to strengthen the rupee against the US dollar to some extent, a significant appreciation isn't anticipated. The cautious optimism is grounded in the RBI's likely intervention in the foreign exchange market to accumulate forex reserves, which currently stand at a robust $652.9 billion, making them the fourth-largest globally. The presence of substantial reserves enables the RBI to manage currency volatility effectively, thereby maintaining stability in the exchange rate. India's currency, largely due to proactive measures by the RBI, has been one of the most stable among major emerging market currencies. Yet is has seen some turbulence for a brief period last year. This stability enhances India's attractiveness as an investment destination, supporting a narrative of sustained economic growth and stability. Bond Market Dynamics The influx of foreign investments has already had a profound impact on India's bond market. Trading volumes in government bonds have surged to their highest levels in nearly five years, reflecting heightened investor activity and interest. Foreign investors, in particular, have shown a preference for longer-tenor government bonds in anticipation of potentially higher returns once the RBI initiates interest rate cuts later in the year. This shift towards longer-term bonds has led to a flattening of India's yield curve, with the spread between shorter-term and longer-term yields narrowing to just 11 basis points. This trend underscores investors' expectations of future monetary policy actions and their implications for bond yields across different maturities Economic Implications and Challenges From an economic standpoint, the increased inflows related to India's inclusion in the index are expected to maintain a surplus in India's balance of payments, even though the current account deficit may widen. This surplus is crucial for sustaining stable economic conditions and investor confidence. However, there are looming challenges: Fiscal Discipline: With greater scrutiny from international investors, India's government will have to adhere more closely to fiscal discipline. Any perceived lapses in fiscal management could result in higher borrowing costs for the government, impacting its budgetary flexibility. Market Stability: While the inflows contribute positively to market liquidity and bond yields, excessive volatility or speculative activity could pose risks to financial stability. Therefore, careful monitoring and regulatory oversight are essential to mitigate such risks. Currency Management: Despite the RBI's proactive stance on currency stability, managing the impact of large capital inflows on the rupee remains a critical task. Effective management of foreign exchange reserves and prudent intervention in the forex market are vital to prevent excessive volatility in the rupee's valuation. Long-term Outlook and Policy Considerations Looking ahead, India's inclusion in the JPMorgan EM Debt Index signifies a pivotal moment in its integration into global financial markets. The substantial inflows of foreign capital not only underscore India's growing stature as an investment destination but also present opportunities and challenges for policymakers: Policy Alignment: Ensuring alignment between monetary policy objectives, fiscal discipline, and market expectations is crucial. This requires proactive measures to enhance transparency, strengthen regulatory frameworks, and foster a conducive environment for sustainable economic growth. Infrastructure Investment: Leveraging foreign investments to bolster infrastructure development and address structural constraints can unlock long-term growth potential. Strategic allocation of capital towards infrastructure projects can enhance productivity, attract further investments, and stimulate economic activity across various sectors. Sustainable Growth: Promoting inclusive and sustainable growth remains a priority. Investments in education, healthcare, and social infrastructure are essential for building a resilient economy capable of withstanding global economic fluctuations and external shocks. Conclusion India's entry into the JPMorgan EM Debt Index represents a significant opportunity for the country to attract substantial foreign investments into its government bonds. This move not only underscores investor confidence in India's economic fundamentals but also poses challenges related to fiscal management, currency stability, and market regulation.As India navigates the complexities of integrating into global financial markets, policymakers must adopt a balanced approach that promotes economic stability, fosters sustainable growth, and addresses emerging challenges effectively. By leveraging foreign investments strategically and implementing prudent policy measures, India can capitalize on this opportunity to strengthen its position as a leading emerging market economy in the years to come. Abhisht Chaturvedi is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Stefan Ivanovski and Arpit Chaturvedi (Watch video on: https://youtu.be/-ydycA45L6Q ) Why do robots need rights? It may seem counterintuitive, but better rights for robots mean better rights for humans.  This article will first lay out the reasons why robots need rights and what is required to implement this proposal. By robots, we refer to any type of digital technology such as artificial intelligence (AI), generative AI, AI algorithms, and any other digital tools that can work around the clock at augmenting, replacing, or controlling the work of humans (Doellgast 2023).  There are three main reasons why robots need rights.   First, Homo Sapiens are not the only species that benefit from rights. As the article will argue, there are legal and moral arguments in favor of extending legal personhood, and therefore providing material protections for rights for non-human species and entities such as the Whanganui River in New Zealand or the Ganges River in India.  Second, there is a utilitarian argument. Granting robot rights will ensure that robots and AI algorithms incorporate the human values we cherish and contribute to the development of the world in the direction of these values. In turn, integrating human values in robots is a good insurance measure for a scenario where robots begin to exercise significant decisionmaking power over human beings. Under such a scenario, robots are likely to extend benefits and exceptions to human beings in line with the rights encoded in their algorithms.  Third, as strange as it may sound, robots may develop emotions. There is one thing for certain, and that is we cannot accurately predict the future. The technology is not there yet, but this does not preclude us from advancing an argument that in the case that robots develop emotions, there should be rights to protect them. Again, a stronger set of protections for robot emotions will mean a stronger framework of protections for human emotions. There have been scholars who have advanced moral arguments for granting animals the same rights as humans, on the grounds that animals, just like Homo Sapiens, are sentient species (Steiner 2008). In the last section, we will discuss how to implement this through describing the principles and encoding rights in AI protocols, which will be a major component of how robots will operate in the future. (Rights for Robots, Image by ChatGpt 4o) How was the idea for this article born? Labor rights for robots mean labor rights for humans. Robots are thought to replace humans. However, if we want to improve labor rights and working conditions for humans in the rising age of robots and digital transformation there needs to be parity with robots. Robots need labor rights as well.  If you think that more efficiency for humans will be achieved through allowing robots to work through weekends, holidays, then you may be wrong.  Robots too need paid-holidays, sick days, and other labor rights and benefits for human workers that are enshrined in the Universal Declaration of Human Rights (UNDHR), the Fundamental Conventions of the International Labor Organization (ILO), and many country’s constitutions and laws. Robots too help create surplus value and they should be duly compensated. Although robots can in theory work without a break, over time, they require maintenance, and they too break down. This is why we advocate for robot rights.  Stefan is a PhD student at the School of Industrial and Labor Relations at Cornell University, where students study the world of work and how to improve working conditions for workers. So, it was not unnatural or illogical for Stefan to start making the argument that robots, as producers of value, should also have labor rights. This is how the idea for this article was born. What you are reading below is a product of the joint intellectual effort of Stefan Ivanovski and Arpit Chaturvedi (Cornell University MPA ‘18). The story started on February 1, 2024. Stefan and Arpit met for the first time over dinner at Telluride House at Cornell University. A mutual friend invited them. It was a diverse group of Cornell students, mostly lawyers, but they hailed from different parts of the world, Asia, the Middle East, and Europe. There were vibrant conversations on many topics. Then, Stefan shared his controversial opinion that robots should have labor rights. He shared an anecdote that inspired him to make the claim that robots should have rights. Arpit jumped on and expanded the discussion from labor rights for robots, to broadly, rights for robots. After receiving some friendly backlash about their outrageous ideas, and what seemed to their friends as an advocacy for robots and for a robot-led world order, Stefan and Arpit, agreed that they would write an article about robot rights.  Stefan recalls how one day he wanted to pay his taxes in his native Macedonia around 8pm on a Thursday. He logged into his bank account. He filled out the required payment details and he pressed send. The system rejected his payment. The error message stated that he had to choose a valid time. Stefan was struck to learn that by valid time the system required payments to be made during business hours. He thought to himself, “this is an electronic payment system, why does it matter at what time of the day I am filing the payment? When I send an email, the email instantly arrives. There are no hours of operations for sending or receiving an email. It is a 24/7 service!”  However, the error message made Stefan think further: “What am I doing filing taxes at 8pm on a Thursday night? I should be spending time with my partner, family, and friends!” If robots can work through weekends and holidays, then there certainly will be humans who will monitor the work of the robots, especially in those jobs where there is a need for human augmentation.  However, even in jobs that can be fully automated or managed by robots, there needs to be robot rights. In the following sections we will outline why rights for robots matter and how to implement them. Why do rights for robots matter? The idea that an AI algorithm could have rights might seem ridiculous at first. After all, rights can only exist where there is agency and consciousness. However, there are arguments both instrumental and moral on why AI algorithms should have rights. Rights are Not Just for Homo Sapiens Rights are not the monopoly of human beings. Or more precisely, homo sapiens need not be the only entities bearing rights in the legal world. In 2017, a groundbreaking event occurred when the Whanganui River in New Zealand was recognized as a legal entity. This was the first instance in history where a river was given the same legal rights, responsibilities, and potential liabilities as a human being. The court decided that two people, a representative of the Crown and a representative of Whanganui River, will be appointed to act on the river’s behalf and protect its interest. (Photo: Whangui River, Wikimedia Commons) Shortly after the bill passed in New Zealand, India’s Uttarakhand High Court granted the same legal personhood to the river Ganges. The legal personhood status was based on the Maori worldview that sees the river as an integrated, living entity with its own rights and values. It reflects a shift towards acknowledging the interconnectedness of ecosystems and the need to protect the natural environment for future generations. Legally, it was recognized that ecosystems, like individuals, have inherent rights to exist, flourish, and regenerate. Likewise, in 1969, the Supreme Court of India, in the case of 'Yogendra Nath Naskar v. Commission of Income-Tax, Calcutta,' declared that a Hindu idol is like a legal person. This means it can own property and be taxed through its Shebaits (humans appointed to act on behalf of deity are called the "shebait"), who are responsible for managing the idol's possessions. Legal personality, also known as juristic personhood, is a fundamental concept in jurisprudence, as articulated in various legal sources. According to Salmond on Jurisprudence (12th Edn., 305), a legal person is defined as "any subject-matter other than a human being to which the law attributes personality." The entities falling under this category are those "created and devised by human laws for the purposes of society and government," commonly referred to as "corporations or bodies politic." Analytical and Historical Jurisprudence (3rd Edn., page 357) defines a "person" for the purpose of jurisprudence as "any entity (not necessarily a human being) to which rights or duties may be attributed." This definition encapsulates the broad scope of legal personality, extending beyond the realm of natural persons. The evolution of fictional personality into a juristic person is deemed essential for socio-political-scientific development. Paton's "Jurisprudence" (3rd Edn., pages 349-350) further elaborates on the nature of legal personality, asserting that it is an "artificial creation of the law." Legal persons are entities capable of being "right-and-duty-bearing units," acknowledged by the law as capable of being parties to legal relationships. As Salmond puts it, "a person is any being whom the law regards as capable of rights and duties." The arbitrary nature of legal persons, as creations of the law, is emphasized by Salmond. In his exposition, he notes that while the law can recognize numerous kinds of legal persons, the ones acknowledged within the legal system are relatively few. Corporations are expressly identified as legal persons, and there is a suggestion that registered trade unions and friendly societies (mutual associations) may also fall under this classification (see endnote 1) . Drawing parallels with established legal entities like corporations, an argument can be made that robots and AI algorithms, when recognized as legal persons, could be attributed with the capacity for both rights and duties. In this context, the duty-bearing aspect becomes instrumental in ensuring that robots and AI algorithms, like any legal person, are subject to legal obligations and can be held accountable for their actions. The algorithms legal representatives could be called upon and held accountable just like the shebaits for the idols or representatives for the Whanganui iwi were appointed to act on the river’s behalf. These human agents, within prescribed legal limits, would act as representatives of the legal persona attributed to the AI algorithm, further reinforcing the duty-bearing nature of legal personality. Drawing parallels with established legal entities like corporations, an argument can be made that robots and AI algorithms, when recognized as legal persons, could be attributed with the capacity for both rights and duties. Recognition of AI algorithms as legal persons also aligns with the socio-political-scientific development, given the increasing role of AI in various facets of society. Granting legal personality to AI acknowledges their evolving status as entities with the capacity for both rights and duties in the legal landscape. Further, by doing this AI algorithms, much like traditional legal persons, can be considered capable of owning property, entering into contracts, and being subject to legal obligations. Recognizing AI algorithms as legal persons could thus provide a legal framework that holds AI accountable and responsible as an entity for dealing with the various consequences of AI actions.  Already in various legislations, there is a consideration of holding human beings accountable for the actions of high risk AI, popularly known as the “human-in-the-loop (HITL)” model of AI governance. Human-in-the-loop (HITL) is an AI governance model where humans actively oversee and approve AI decisions, while human-out-of-the-loop (HOOTL) allows AI to operate autonomously without direct human intervention. Given that HITL is emerging as a popular and viable regulatory approach, and given the precedences of according non-human entities status of legal personhood, it may well be argued that AI algorithms should be treated as human beings or legal persons in the eyes of the laws. This would not only keep AI accountable, it would also recognize the role that AI plays and will play in our daily lives. Making AI a duty bearing unit would also come with it being a right bearing unit due to the inalianable nature of duties and rights for the functioning of the law. Not only this, according personhood to AI will result in a significant reduction in the currently existent confusion on AI regulations and will expand the scope for a comprehensive regulatory environment for AI. Can an algorigthm result in a murder? There is a contentious debate around this question. These and many other complex questions will potentially find some resolution with algorithms attaining the status of "right-and-duty-bearing units." The Utilitarian Argument for Rights to AI Algorithms While in the previous section we have argued that (a) rights of personhood can be attributed to non-homo sapien entities, (b) the legal and jurisprudential arguments to attribute such rights to AI algorithms and (c) how doing so could provide a more comprehensive legal framework for AI regulations. In this section, we argue from a rationalist perspective in favor of according rights to AI algorithms. We argue that attributing such rights can indeed, be beneficial for human beings and could lead to a more symbiotic rather than a competitive relationship between AI and humans. This would need some backward induction – a technique of reasoning where one starts from the end of a problem and works their way to the beginning (see endnote 2). Imagine this: In a future where AI has escaped human control and is now shaping human condition and human values in its own image and as per its own logics, much like the humans have done with nature and technology, it would be beneficial for human beings to encode AI with human values. An AI algorithm that has internalized human values is also likely to be more benevolent to human beings in the scenario where human beings become subservient to the algorithms (these doomsday scenarios have been repeatedly and seriously considered by scientists and technology leaders). Moreover, when AI becomes self-referential and influential enough that it is shaping human values (some argue that it already is with social media platforms now using AI based suggestions and searches), it would be beneficial for human beings to pre-emptively encode these algorithms with human values, especially the ethics and norms related to the Universal Declaration of Human Rights , so that AI replicates such values in future human societies. An AI algorithm that has internalized human values is also likely to be more benevolent to human beings in the scenario where human beings become subservient to the algorithms (these doomsday scenarios have been repeatedly and seriously considered by scientists and technology leaders). The absence of encoded rights could lead to an AI-driven society that doesn’t align with human values. This could result in societal structures that are detrimental to human well-being. If we grant AI personhood rights and ensure these rights are exercised, AI would have some human values encoded. This would not make AI inefficient or biased, but rather, it would ensure that as AI shapes society, it does so in a way that respects and upholds human values. (Image showing AI dominating human beings; made with GPT4o) Since AI will shape society and as it develops it could become increasingly self referential, an encoding of rights would be necessary for AI to build rights based society. The process of granting rights would involve careful consideration of what these rights should be, ensuring they align with our most cherished human values. This would not only protect humans but also guide AI development in a direction that is beneficial for society. Moreover, given the current concerns about AI replacing human jobs and potentially causing harm to human well-being, if AI has rights and it exercises those rights it would have encoded some of the human values (which inevitably are being encoded in AI algorithms because it is built on human data). The AI would give its human subjects the necessary holidays, breaks, and dignity. To be clear, this is not about making AI inefficient or encoding yet another bias in the AI in the form of rights. The idea is to reduce human biases, reduce the negative insticts of humankind, and increase the proportion of humanitarian values in AI algorithms. Robots may develop emotions: How did Animal Rights Evolve? During the Renaissance and Enlightenment periods in Europe (14th to 18th centuries), thinkers such as René Descartes proposed the idea that animals were mere automata without consciousness or feelings. However, Enlightenment philosophers like Jeremy Bentham began questioning these views, arguing that the capacity to suffer, rather than rationality alone, should be the basis for moral consideration. In more recent years, Gary Steiner, has written about animal rights and moral philosophy. He argues that animals have their own subjective experiences that matter to them, in addition to feelings, and therefore this should grant them equal treatment to humans, when it comes to rights. The animal rights movements draw their origins from these inquiries. The 19th century witnessed the rise of anti-cruelty movements in response to the harsh treatment of animals in industrial settings. Legislation such as the Cruel Treatment of Cattle Act in the United Kingdom (1822) marked an early legal recognition of the need to protect animals from cruelty. The beasts of burden, and with time, most animals, began to possess rights - much like human beings.  The argument does not stop with beasts of burdens and large animals but it is now being extended to crustaceans – which include edible crabs, prawns and lobsters. The question of whether shrimps feel pain is a subject of ongoing scientific debate. Shrimps (prawns, crabs, etc.), like other crustaceans, have a functional nervous system and sensory receptors that help them detect environmental stimulations. They also possess opioid receptors similar to those of mammals. These receptors are necessary for detecting and responding to potentially harmful stimuli. In a study conducted by Robert Elwood and his colleagues at Queen’s University Belfast in the UK, shrimps were observed grooming and massaging an irritated antenna for up to five minutes after being exposed to the irritant acetic acid. This behavior could be interpreted as an indication of pain experience . However, the complexity of pain, which is a mental state associated with suffering, makes it difficult to unambiguously determine its presence in animals. While shrimps exhibit responses to potentially painful stimuli, these responses could be reflexive rather than indicative of a subjective experience of pain. Nevertheless, various rights groups now are now advocating for the rights of shrimps and prawns because they feel pain. (The shrimp Palaemon serratus of the infraorder Caridea , Wikimedia Commons) At the heart of the debate was the consideration of whether these creatures have consciousness or not. And this should lead us to question whether machines have consciousness or not. However, that is a much more complex and ambitious question. A more immediate enquiry should lead us to determine whether machines can suffer? Just as shrimps have a functional nervous system and sensory receptors, advanced AI systems could potentially be equipped with sophisticated sensory inputs that allow them to respond to harmful stimuli. In a recent article  in Nature, Kingson Man and Antonio Demasio (2019) argue that such an artificial sense of feeling might arise  if robots were programmed to experience something akin to a mental state such as pain. This would imply the need for bringing in rights for AI, just as we did for animals.  However, responding to harmful stimuli is not the same as experiencing pain. Yet, if shrimps are counted as creatures who can potentially have rights because they feel pain and even be sentient , it is likely that in the future, we would not find it absurd to accord such rights to robots as well. If we, as human beings, accord rights to any entity that feels pain, then AI could be one of them qualifying it to become a right bearing entity. Moreover, again going back to the utalitarian perspective, it is easy to see that human beings eventually got behind protecting animals, even if they could not directly experience an animal's physical and psychological conditions, because they (we) had a sense of rights. Human beings simply extended their own sense of human rights and dignity to other living beings. If we, as human beings, accord rights to any entity that feels pain, then AI could be one of them qualifying it to become a right bearing entity. When AI or robots develop to a level where they can have a more significant impact on the world (and it could be sooner than we expect since AI algorithms evolve in an exponential manner), they in their own turn, could look at human beings just like the human beings looked at animals. If humans had no sense of rights and dignity, they would have never extended these to other living beings but they did. They did too little and too late, but animal rights did become an accepte value and has had significant impact on policy. Similarly, if AI, from the very begining has encoded rights and a sense of dignity, it could be expected that it would accord dignity to non-AI entities, such as human beings, once it becomes influential enough to significantly impact their lives. Human beings simply extended their own sense of human rights and dignity to other living beings. How to implement robot rights?  Encoding Rights in AI Protocols There are various norm setting protocols out there when it comes to regulating AI. The European Union has the Ethics Guidelines for Trustworthy AI , the EU AI Act , then there is the Montreal Declaration for Responsible AI , UNESCO has its own set of Recommendation on the Ethics of Artificial Intelligence , and many countries such as Singapore, Canada, Korea, and other countries have developed AI strategies directly or indirectly based on these principles. However, most of these principles are focused on how humans should regulate AI, without much consideration on how AI would regulate human beings and what we can do to plan for that scenario.  If AI indeed reaches such a state, which according to various estimates, it is likely to do so, then it would be necessary to encode such protocols not just in the AI norm setting principles, but in actual programs, so that the AI can avoid exploiting human beings by being self-referential. This is to say that we should encode AI algorithms in a manner that they do consider certain rights as innate and foundational aspects of existence and they see themselves, as well as human beings and hopefully even other species, as possessing such rights. If human beings had no innate sense of rights, they would not have been able to extend a similar logic to the animals and nature. The reason why humans thought animals have rights and should be protected against exploitation is because humans had a self awareness - an innate encoding of some fundamental rights that exist for themselves (irrespective of the fact whether this coding came into existence naturally or evolved over time with philosophy and laws) and could be extended to the animals. Therefore, if AI programmers encode two things in algorithms - a sense of rights and a sense of “doing unto others as you would have them do unto you”, i.e. a karma code, then there is a glimmer of hope that in the event of an AI dominated world, the AI will be kinder to humankind.  Conclusion Looking back, we can see that the rights for robots and AI algorithms also mean rights for humans in a world that is moving in the direction to be dominated by robots and AI algorithms.  Some critics will point out that if there is parity between robot rights and human rights, then robots would also be entitled to overtime, paid-sick or maintenance time and so forth. Some may even wonder, “does that mean that there will be internet shutdowns during weekends?” Most likely, yes. This is not unusual as even the stock market does not work over the weekends, yet it is one of the vehicles for wealth generation. When there is a big economic or financial shock, trading is paused or it arbitrarily ends. If trading is automated, why is it not done around the clock? Why are financial traders given a break over the weekend or after 5pm, when most stock market exchanges stop working?  This is in order to avoid larger calamities.  Therefore, if AI programmers encode two things in algorithms - a sense of rights and a sense of “doing unto others as you would have them do unto you”, i.e. a karma code, then there is a glimmer of hope that in the event of an AI dominated world, the AI will be kinder to humankind.  If we are to ensure that we will preserve rights as humans, we need to encode rights for robots. Only through parity in rights between robots and humans can we achieve a more dignified working future. The future of work is a future with rights for robots.  Endnotes Salmond categorizes legal persons into three main types. Firstly, there are corporations, formed by personifying groups or series of individuals. These individuals, constituting the corpus of the legal person, are referred to as its members. Secondly, institutions, such as churches, hospitals, universities, or libraries, can be recognized as legal persons by the law. In this case, the corpus for personification is not a group of persons but an institution itself. Thirdly, legal persons can also encompass funds or estates dedicated to special uses, like charitable funds or trust estates. Backward induction involves examining the last decision point and identifying the best action at that stage. This process continues in a backward manner until the optimal action for every possible point in the sequence is determined. This iterative process results in a sequence of optimal actions, providing a roadmap for decision-making from start to finish. References Doellgast, Virginia, Ines Wagner, and Sean O’Brady. 2023. "Negotiating Limits on Algorithmic Management in Digitalized Services: Cases from Germany and Norway." Transfer: European Review of Labour and Research  29 (1): 105-120. SAGE Journals. Doellgast, Virginia. 2023. "Strengthening Social Regulation in the Digital Economy: Comparative Findings from the ICT Industry." Labour and Industry  33 (1): 22-38. Tandfonline . Doellgast, Virginia, and Valerio DeStefano. 2023. "Regulating AI at Work: Labour Relations, Automation, and Algorithmic Management." Transfer: European Review of Labour and Research  29 (1): 9-20. SAGE Journals. Steiner, Gary. 2008. Animals and the Moral Community: Mental Life, Moral Status, and Kinship . New York: Columbia University Press. Supreme Court of India. Yogendra Nath Naskar v. Commissioner of Income Tax, Calcutta , 1969 AIR 1089, 1969 SCR (3) 742. Indian Kanoon. Legal Service India. "Rights of A Deity." Legal Service India. Salmond, John W., and P. J. Fitzgerald. Salmond on Jurisprudence . 12th ed. London: Sweet & Maxwell, 1966. WorldCat . Paton, George Whitecross. A Text-Book of Jurisprudence . 3rd ed. Oxford: Clarendon Press, 1967. Amazon . Hohfeld, Wesley Newcomb. Fundamental Legal Conceptions as Applied in Judicial Reasoning and Other Legal Essays . Yale University Press, 1919. McFarland, Alex. 2022. "What is Human-in-the-Loop (HITL)?" Unite.AI . Unite.AI . Man, Kingson, and Antonio Damasio. 2019. "Homeostasis and Soft Robotics in the Design of Feeling Machines." Nature Machine Intelligence  1: 446-452. Nature . Disclaimer Rights for robots is not a new idea. We confirm that we have independently authored this article without prior consultation to other related literature. For those interested in consulting some earlier work on the topic, they can check out Rights for Robots: Artificial Intelligence, Animal and Environmental Law by Joshua C. Gellers or Human rights for robots? A literature review by John-Stewart Gordon & Ausrine Pasvenskiene. Authors Stefan Ivanovski is a PhD student at the School of Industrial and Labor Relations at Cornell University studying the democratization of ownership and management of companies that are shaping the future of work, especially those that rely on remote work and cutting-edge technologies such as artificial intelligence. He is also a lead contributor for the Lifestyle Democracy blog , where he writes on the topics of technology, democracy, and society. Arpit Chaturvedi (MPA Cornell University) is a policy entrepreneur. He is the Founder of the political risk management and policy advocacy firm Insights International. He is a Research Manager to Dr. Kaushik Basu at Cornell University and serves as the Joint-Director of the Global Policy, Diplomacy, and Sustainability Fellowship. He has taught graduate level courses at the San Francisco University, the Indian School of Public Policy, and other institutions across the globe. He is also the author of the book, " Our Egaliatian Universe? ".

Political power has often been illusory and has drawn a lot of interest from both practitioners and theoreticians. In this video I attempt to answer the question - do you need political power in order to have political power?

Where power lies, is often not understood well and that is why many individuals and movements fail. It is important to understand the three faces of power - the visible, the hidden, and the invisible.

By Abhisht Chaturvedi The Reserve Bank of India (RBI) released an update to its "Guidance Note on Management of Operational Risk" on April 1, 2024. This update incorporates the latest international best practices and aligns with the Basel Committee on Banking Supervision (BCBS) principles. The note applies to regulated entities (REs) in the financial sector, including commercial banks, cooperative banks, all-India financial institutions, and non-banking financial companies (NBFCs). The inclusion of NBFCs in the operational risk management note is an indication of greater and more active regulation of the NBFC sector at par with the regular commercial banks and the rest of the financial sector going forward. Further, the RBI noted that until recently, the primary operational risks faced by regulated entities (REs) stemmed from vulnerabilities associated with the increasing dependence on and rapid adoption of technology for providing financial services and intermediation. However, the financial sector’s growing reliance on third-party providers (including technology service providers), amplified by the Covid-19 pandemic and the shift to virtual working arrangements, has underscored the rising importance of operational risk management and operational resilience. This not only strengthens an RE's ability to remain a viable ongoing concern but also supports the financial system by ensuring the continuous delivery of critical operations during any disruption. These updates also signify the RBI's ongoing commitment to strengthening the risk management practices of Indian banks. They encourage banks to move beyond simply managing operational risks to building resilience against unforeseen events. Here's a breakdown of the key changes: Focus on Operational Resilience: The updated note emphasizes the concept of operational resilience. This refers to a bank's ability to absorb, adapt to, and recover from operational disruptions while maintaining critical functions. Alignment with BCBS Principles: The framework is now aligned with the revised "Principles for the Sound Management of Operational Risk" and "Principles for Operational Resilience" issued by BCBS. This ensures consistency with international standards. Scenario Testing: The updated note emphasizes the importance of conducting regular scenario testing. This involves simulating potential operational disruptions like cyberattacks, natural disasters, or system failures to assess the bank's ability to respond and recover. Incident Response Management: The guidance highlights the need for a robust incident response management plan. This plan outlines the steps a bank will take to identify, contain, recover from, and learn from operational disruptions. Continuous Improvement in Risk Management It's important to understand that the RBI's approach to risk management is dynamic. While there haven't been any entirely new guidance notes in recent days, the RBI constantly revises and updates existing ones to reflect evolving risks and best practices. They actively monitor the banking landscape and may issue specific circulars or notifications addressing emerging risk areas. Here are some ways the RBI promotes continuous improvement in risk management: Supervisory Reviews: The RBI conducts regular on-site and off-site supervisory reviews of banks to assess their risk management practices. Based on these reviews, they may provide specific guidance or recommendations for improvement. Benchmarking: The RBI encourages banks to benchmark their risk management practices against national and international standards. This helps banks identify areas for improvement and learn from best practices adopted by other institutions. Industry Outreach: The RBI regularly interacts with the banking industry through workshops, seminars, and conferences. These interactions facilitate discussions on emerging risk trends and best practices in risk management. Conclusion The recent update to the "Guidance Note on Operational Risk Management and Operational Resilience" demonstrates the RBI's proactive approach to strengthening risk management in Indian banks. While there may not be frequent issuance of entirely new guidance notes, the RBI's commitment to continuous improvement ensures a robust and evolving framework for managing risks in the banking sector. Abhisht is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Abhisht Chaturvedi India's recent decision to allow 100% foreign direct investment (FDI) in the space sector marks a significant milestone in the country's quest for space exploration and commercialization. The proposed FDI Space Policy, with its clear guidelines and thresholds, is likely to spur a wave of innovation, collaboration, and growth in the Indian space industry. India's decision to liberalize the space sector and open it up to 100% FDI presents a host of opportunities for both domestic and foreign stakeholders. By attracting foreign investment and expertise, India can accelerate the pace of innovation, expand its industrial base, and strengthen its position in the global space market. Foreign collaboration can bring in advanced technologies, best practices, and access to new markets, driving efficiency, competitiveness, and growth in the Indian space industry. It can also facilitate technology transfer, skill enhancement, and knowledge exchange, empowering local businesses (especially for component sourcing) and workforce. Under the new policy framework, various activities within the space sector have been categorized, each with its own FDI thresholds and entry routes. Opportunities in Specific Product Segments Satellites: Manufacturing & Operation, Satellite Data Products, and Ground Segment & User Segment The FDI threshold for activities related to satellites, including manufacturing, operation, satellite data products, and ground segment & user segment, is set at up to 74% under the automatic route. This means that foreign investors can directly invest up to 74% in these activities without requiring prior approval from the government. Beyond 74% (up to 100%), approval will be needed through the government route. This provision opens up avenues for collaboration and investment in satellite technology, data analytics, and ground infrastructure with companies in the US (such as Tesla) and other global players. It paves the way for the development of advanced satellite systems, enhanced data services, and improved connectivity, which are crucial for applications ranging from telecommunication and navigation to weather forecasting and disaster management. Launch Vehicles and Associated Systems or Subsystems, Creation of Spaceports For activities related to launch vehicles, associated systems or subsystems, and the creation of spaceports, the FDI threshold is set at up to 49% under the automatic route. Beyond 49% (up to 100%), approval will be required through the government route. This provision encourages investment in launch vehicle technology, infrastructure development, and spaceport facilities. It presents opportunities for collaboration in the design, manufacturing, and operation of launch systems, enabling India to enhance its capabilities in space transportation and satellite deployment. Manufacturing of Components and Systems/Sub-systems for Satellites, Ground Segment, and User Segment The FDI threshold for manufacturing components and systems/sub-systems for satellites, ground segment, and user segment activities is set at up to 100% under the automatic route. This means that foreign investors can fully own and operate businesses engaged in the manufacturing of key components and systems essential for satellite operations and ground infrastructure. This provision promotes investment in high-tech manufacturing facilities, research and development initiatives, and skill development programs. It fosters the growth of a robust ecosystem of suppliers and service providers, supporting India's ambition to become a global hub for satellite manufacturing and technology development. Potential Risks and Pitfalls However, while the liberalization of the space sector presents immense opportunities, it also poses certain challenges and considerations that need to be addressed. These include issues related to national security, intellectual property rights, technology transfer, and regulatory compliance. There is still no clear protocol to identify which technology counts as “dual use” i.e. can both have commercial application and pose a military threat. Our discussions with leaders in the space industry suggest that the lack of such a protocol stifles progress leads to bureaucratic roadblocks. India must ensure that adequate safeguards and mechanisms are in place to protect its strategic interests, safeguard sensitive technologies, and maintain sovereignty over its space assets. It must also establish clear guidelines, regulations, and oversight mechanisms to govern foreign investment and ensure compliance with international standards and obligations. Conclusion India's decision to allow 100% FDI in the space sector under the proposed FDI Space Policy heralds a new era of collaboration, innovation, and growth in the Indian space industry. By embracing foreign investment and fostering strategic partnerships, India can unlock the full potential of its space sector, propel technological advancements, and emerge as a global leader in space exploration and commercialization. As India embarks on this transformative journey, the world eagerly anticipates the remarkable achievements and contributions that lie ahead. Abhisht is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Abhisht Chaturvedi Elon Musk, CEO of Tesla, has been in conversation with the Government of India to enter the Indian market with the recent announcement of Tesla's plans to manufacture electronic vehicles in the country. This strategic move follows the Indian Government's decision to impose a 15% import duty electric vehicles down from a 100% tariff, with a requirement of sourcing 50% of the components from local sources. While Musk's announcement has stirred excitement among Tesla enthusiasts, it has also triggered apprehensions among existing automobile manufacturers in India. The Indian Government's decision to levy a 15% import duty on electric vehicles reflects its broader agenda of promoting domestic manufacturing and fostering the growth of the electric vehicle ecosystem in India. By encouraging local production, the government aims to create jobs, stimulate economic growth, and reduce dependence on imported goods. Tesla's decision to set up manufacturing operations in India aligns with these objectives and signals its commitment to the Indian market. The Indian automotive industry, renowned for its resilience and adaptability, now finds itself at a crossroads as Tesla prepares to make its mark on Indian soil. With a commitment of $2 billion towards its Indian operations, Tesla's entry signifies a significant investment in the country's burgeoning electric vehicle sector. The company is reportedly exploring various locations, including Gujarat and Maharashtra, for the establishment of its manufacturing plant. However, Tesla's foray into India hasn't been met with universal acclaim. Established automobile companies in India are grappling with the prospect of increased competition and disruption within the industry. Tesla's reputation for cutting-edge technology and sleek design poses a formidable challenge to traditional automakers, who now face the daunting task of defending their market share amidst Tesla's entry. Tesla's entry into India has the potential to accelerate the adoption of electric vehicles and drive innovation in the automotive sector. With its state-of-the-art technology and global brand appeal, Tesla could catalyze a shift towards sustainable mobility in India, contributing to efforts to mitigate climate change and reduce pollution. Moreover, Tesla's presence could stimulate competition and incentivize existing automakers to invest in research and development, ultimately benefiting consumers with advanced technologies and improved products. However, Tesla's success in India is not guaranteed, and the company faces several challenges as it navigates the complexities of the Indian market. Infrastructure limitations, including inadequate charging infrastructure and logistics challenges, pose significant hurdles to the widespread adoption of electric vehicles in India. Moreover, Tesla must navigate regulatory and bureaucratic hurdles to ensure smooth operations and compliance with local laws and regulations. Despite these challenges, Tesla's entry into the Indian market represents a significant milestone in the country's journey towards sustainable mobility. It offers an opportunity for collaboration and partnership between Tesla and existing players in the Indian automotive industry, fostering innovation and driving growth. As India embraces the electric vehicle revolution, the stage is set for a transformative shift in the automotive landscape, with Tesla leading the charge towards a greener and more sustainable future. Tesla is also reportedly in talks with Reliance Industries Limited (RIL) to form a joint venture to set up a manufacturing facility in the country. However, as per experts, the move shouldn’t be taken as Reliance’s entry into the automobile space. RIL’s objective in the joint venture is to create capacities for electric vehicles in India. While the role of RIL hasn’t been crystalised yet, it is expected that the Indian conglomerate may play a significant hand in establishing the manufacturing facility and the allied ecosystem for Tesla in India. Partnering with high capability Indian organizations, seems to be a viable way forward for foreign organizations to navigate the Indian markets as it provides a reliable partner with domestic knowhow. We expect such joint ventures to accelerate as more companies plan their entry into the Indian markets. About the Author: Abhisht is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Abhisht Chaturvedi India's strategic initiative to establish a domestic semiconductor industry represents a significant shift in its technological and economic policy, with the government approved a substantial investment of 1.26 trillion rupees (approximately $15.2 billion USD, with 1 USD = 83.3 INR). This move is aimed at reducing dependency on semiconductor imports, notably from China, and fostering an indigenous manufacturing ecosystem will come with a substantial government subsidy (nearly half of the invested value). The hope is that this subsidy will place India on a strong footing in the global semi-conductor supply chain in particular and global technology supply chains in general. The plan includes setting up three semiconductor chip-making plants and to inaugurate them by July-August, 2024. The largest of these, a collaboration between Tata and Taiwan's Powerchip, will see a combined private and public investment of 910 billion rupees (approximately $10.92 billion USD) in Gujarat's Dholera. Furthermore, CG Power will partner with Japan's Renesas Electronics Corp and Thailand's Stars Microelectronics to establish a 76 billion rupees (approximately $912 million USD) chip packaging plant, also in Gujarat. The third facility, with a combined investment of 270 billion rupees (approximately $3.24 billion USD), will be a chip packaging plant set up in Assam by Tata Semiconductor Assembly and Test Pvt Ltd. Economic Implications Indian Electronics Minister Ashwini Vaishnaw indicated that construction for these plants would start between June to August 2023, focusing on sectors like defense, electronic automobiles, and telecommunications. This development is not just an economic endeavor but a testament to India's aspirations for technological self-reliance and enhanced economic security. Yet there are other direct and indirect economic benefits involved. The semiconductor industry is labor-intensive, requiring a vast array of skilled labor. Thus, establishing local manufacturing will likely spur job creation across various sectors, including engineering, manufacturing, research, and development. This job growth extends beyond the immediate semiconductor industry, potentially benefiting ancillary sectors such as logistics, construction, and services. Moreover, the need for a sophisticated semiconductor manufacturing base will drive substantial investments in research and development, fostering an environment ripe for innovation and technological advancement. This could not only spur the growth of India's broader technology ecosystem but also facilitate knowledge transfer and collaboration with global semiconductor powerhouses. A thriving semiconductor industry could significantly contribute to India's GDP growth, enhancing manufacturing output, stimulating domestic demand for electronic products, and reducing import dependency. The industry's expansion might attract foreign direct investment (FDI), bolstering India's position in the global electronics market and contributing to overall economic resilience. From a supply chain perspective, localizing semiconductor production aims to diversify India's supply chain, reducing economic vulnerabilities associated with import dependencies and enhancing national economic stability. This strategic shift could shield the country from global supply chain disruptions, as witnessed during the COVID-19 pandemic, which highlighted the risks of heavy reliance on semiconductor imports. In Comparative Terms Comparing India's efforts with those of established players like the United States, South Korea, and China provides a broader perspective on its ambitions. The U.S. has a mature semiconductor industry, supported by government funding and a focus on innovation, while South Korea's government-backed policies have fostered a robust semiconductor ecosystem. China, on the other hand, has aggressively pursued semiconductor self-sufficiency through substantial state investments and technology acquisitions. India's venture into semiconductor manufacturing, though in its infancy, is critical for its strategic and economic aspirations. Unlike the established semiconductor markets, India faces challenges such as infrastructure development, skill shortages, and funding needs. However, the strategic significance of this initiative lies in its potential to bolster national security, support strategic industries, and enhance technological sovereignty. Moreover, India's semiconductor initiative can be seen as a move to mitigate geopolitical risks associated with over-reliance on foreign technology and supply chains. The global semiconductor supply chain is highly concentrated, with major manufacturing hubs located in geopolitically sensitive regions. By developing its semiconductor industry, India seeks to reduce its vulnerability to international tensions and supply chain disruptions. Moreover, this initiative aligns with India's broader economic and strategic goals, such as the "Make in India" campaign, aimed at transforming India into a global manufacturing hub. It also reflects a strategic calculus to balance economic growth with national security concerns, ensuring a stable supply of critical components for key sectors like defense, telecommunications, and healthcare. Conclusion Realizing the vision of a self-reliant semiconductor industry requires navigating complex challenges, including aligning policy frameworks, ensuring sustained investment, and developing the necessary infrastructure and skilled workforce. It also requires careful management of international relations, as building a domestic semiconductor industry might affect trade dynamics and necessitate negotiations over technology transfers and intellectual property rights. India's efforts to build a semiconductor industry are not merely economic; they are a strategic imperative to enhance technological independence and sectoral resilience. The initiative represents a long-term vision to position India as a significant player in the global semiconductor market, aligning with its broader economic and strategic objectives. The success of this initiative could redefine India's economic trajectory and enhance its standing in the global technological landscape, making it a pivotal moment in India's economic and technological history. About the Author: Abhisht is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

Author: Abhisht Chaturvedi, Research Analyst, Insights International On March 1, 2024, The Ministry of Electronics & Information Technology (hereafter referred to as the Ministry), Government of India, issued an Advisory for Big Tech Firms like Google, Adobe, etc., which are working on their AI, not on startup firms. All those firms that want to put out their AI in the public domain first should seek permission from the government. Additionally, if a firm wants to release its AI in the public domain while it is still in the underdeveloped stage, it should include a disclaimer stating that the AI is still under development and may not be fully reliable. However, these two advisories have sparked discontent among many firms working on their AI, who believe that this could be a significant obstacle for India to compete on the global stage in terms of tech. Challenges Faced by Big & Small Tech Firms due to Government Regulations While the advisory aims to prevent malpractice in AI, for big tech firms, these advisories may pose logistical challenges and regulatory burdens. The process of obtaining government permission could be time-consuming and bureaucratic, potentially delaying product launches and hindering innovation. For big tech firms, the requirement to seek government permission before deploying underdeveloped AI solutions and the mandate to include a disclaimer about the AI's unreliability could have significant financial implications. The permission process may introduce bureaucratic delays and administrative costs, potentially affecting investment decisions and project timelines. Furthermore, these regulatory advisories may discourage small firms from making significant advancements in the future. The stringent regulatory requirements could create barriers to entry, making it challenging for small firms to compete with established player. Additionally, concerns about the market acceptance of underdeveloped AI solutions may impact the financial viability of AI projects, leading to cautious investment strategies in India's evolving tech landscape. Moreover, concerns about compliance and market acceptance may deter small firms from investing in AI research and development, limiting their ability to innovate and make breakthroughs in the future. For small tech firms, navigating these regulatory requirements could pose challenges. The process of seeking government permission and adhering to disclaimer mandates may seem daunting, particularly with limited resources and expertise. Moreover, the stigma associated with underdeveloped AI may deter potential users and investors, impacting the firm's growth and viability. Benefits and Challenges of AI Disclaimers in Ensuring Credibility and Transparency As for the disclaimer requirements, they may raise concerns about the credibility and market acceptance of underdeveloped AI solutions. However, the disclaimers could benefit the public as well as AI developers themselves. There have been cases where machine learning and large language models instead of getting trained on human produced data, also inadvertently feed on to AI generated data. This can cause distortions and discrepancies that can grow substantially and make the models erroneous and even make them hallucinate more. A label that clearly spells out that an output is AI generated could go a long way in not only helping the public in discriminating between AI generated and human generated data/outputs but also other AI developers as well. Current Situation and Future Directions In response to criticism from both local and global entrepreneurs and investors. The Ministry of Electronics and IT released an updated version of the advisory on March 15, which no longer mandates government approval before launching or deploying AI models in the South Asian market. Instead, firms are advised to label under-tested and unreliable AI models to inform users about potential fallibility or unreliability. The ministry stated earlier this month that while the advisory is not legally binding, it serves as an indication of the future direction of regulation, with government compliance expected. The advisory underscores that AI models must not be utilized to disseminate unlawful content as per Indian law, and should not condone bias, discrimination, or threats to the integrity of the electoral process. Intermediaries are also encouraged to employ "consent popups" or similar mechanisms to transparently notify users about the potential unreliability of AI-generated output. The ministry maintains its focus on ensuring the easy identification of deepfakes and misinformation, advising intermediaries to label or embed content with distinct metadata or identifiers. However, it has removed the requirement for firms to develop a method for identifying the "originator" of specific messages. Despite these challenges, there are avenues for small tech firms to thrive amidst regulatory constraints. By leveraging agile development practices and focusing on iterative improvements, these firms can demonstrate their commitment to addressing AI's developmental challenges. Additionally, fostering open communication with users about the AI's limitations can help build trust and manage expectations effectively. Eventually, it is imperative for the Ministry and top forms to consult with each other and more importantly, it is important for the Ministry to consult with smaller firms because they hold the potential to grow in the future. The effort should be to reach a common ground to ensure that regulation does not impede India's journey to the global stage in terms of technology and doesn't compromise the reliability of AI for People. About the Author: Abhisht is a Research Analyst at Insights International. His research interests include tech policy, media, and communications.

By Jay Makhijani Less than 25% of Micro, Small and Medium Enterprises (MSMEs) have access to credit in India. The credit gap for MSMEs is estimated at INR 20-25 trillion. MSMEs account for nearly 27% of India’s GDP. On average, the MSME sector comprises approximately 36 million units, providing employment to about 80 million individuals. MSME-related products constitute a significant portion of India’s exports. During 2021-2022 (April-September), they accounted for 45.8% of overall exports. Traditional lending models, geared towards long-term commitments and stringent eligibility criteria, often leave out a significant portion of businesses, particularly those without stable incomes. This disparity in access to credit stifles growth and innovation within the MSME sector. The Open Credit Enablement Network (OCEN) attempts to fill this gap by allowing lenders to access data on MSME firms that enables them to offer short tenure and small ticket loans. The recently launched OCEN 4.0 platform introduces a promising shift in MSME lending. By leveraging technology and innovative financial instruments, Open 4.0 aims to democratize access to credit, particularly for the 85% of MSMEs currently underserved by traditional lenders. OCEN 4.0 provides an API (Application Programming Interface) framework that serves as a standardized platform for lenders and borrowers to connect and transact. With the integration of account aggregator frameworks, Open 4.0 empowers lenders with comprehensive, high-provenance data. This allows for better risk assessment and enables cash flow-based lending, unlocking access to credit for previously underserved MSMEs. OCEN, through its API framework, simplifies the process for borrowers to access credit. Borrowers can use the platform to apply for loans, receive credit offers, and interact with multiple lenders seamlessly. This increased accessibility can be particularly beneficial for individuals and businesses that may have had limited access to credit in the past. Further, this platform, incorporates real-time reporting mechanisms, reducing regulatory compliance burdens for lenders. This ensures adherence to guidelines while fostering a conducive environment for innovation and growth. Moreover, in many such platforms, just the creation of a meeting space for lenders and borrowers is not enough. Someone playing the role of a connector or a catalyst is usually desirable. Therefore, OCEN 4.0 introduces the concept of borrower agents, streamlining the lending process and fostering relationships between borrowers and lenders. These agents act as intermediaries, facilitating loan applications, verifying borrower information, and expediting the approval process. By reducing administrative burdens and enhancing transparency, borrower agents play a crucial role in improving access to credit for MSMEs. Potential Risks and Mitigation Strategies Implementing OCEN 4.0 entails various risks, but proactive risk mitigation strategies can help address these challenges effectively. One significant risk is related to data security and privacy concerns arising from the extensive collection and sharing of sensitive financial information within the OCEN ecosystem. To address this, robust encryption protocols and data protection measures must be implemented, along with regular security audits and compliance with relevant data protection regulations. Additionally, operational challenges and infrastructure readiness pose a risk, particularly in areas with limited digital infrastructure and connectivity. Investing in expanding digital infrastructure, providing training on digital literacy, and developing offline capabilities can help overcome these challenges. Credit risk and default management are also critical considerations, given the inherent volatility of MSME lending. Implementing robust credit risk assessment models, diversifying lending portfolios, and offering financial literacy programs to MSMEs can help mitigate these risks. Furthermore, regulatory compliance and legal risks must be carefully managed to avoid fines, penalties, and reputational damage. This involves staying updated on regulatory changes, establishing compliance frameworks, and fostering dialogue with regulatory authorities. Market concentration and competition risks refer to the possibility of a few large players gaining significant control or dominance within the OCEN ecosystem. In such a scenario, these dominant players may have the power to influence market dynamics, potentially limiting competition and choices available to borrowers. This concentration of power could lead to less favorable terms for borrowers and hinder the development of a diverse and competitive lending landscape within the OCEN framework. To mitigate these risks, regulatory interventions are crucial. Regulatory bodies can enact policies and regulations that promote fair competition within the OCEN ecosystem. These regulations may include measures to prevent anti-competitive practices, ensure transparency in lending processes, and promote equal access to lending opportunities for all players, regardless of their size or market presence. Furthermore, collaboration among stakeholders is essential to foster innovation and diversity within the OCEN ecosystem. By encouraging collaboration between large financial institutions, fintech startups, and other players, stakeholders can pool their resources, expertise, and ideas to develop innovative lending solutions that cater to the diverse needs of MSMEs and borrowers. This collaborative approach can help create a more inclusive and competitive lending environment, where borrowers have access to a wide range of lending options and services. Support for alternative lending models is also critical in mitigating market concentration and competition risks. Alternative lending models, such as peer-to-peer lending platforms and community-based lending initiatives, can provide additional options for borrowers, reduce reliance on traditional financial institutions, and promote healthy competition within the OCEN ecosystem. By providing support and incentives for the development and adoption of these alternative lending models, stakeholders can help diversify the lending landscape and reduce the risk of market concentration. The role and active consultations with the Reserve Bank of India and the Finance Ministry would be crucial here to foster easier credit access to the MSME sector. About the Author: Jay Makhijani is a Program Manager at Insights International with a focus on finance, tech, and inclusion policies.

2023, so far seems to be promising for India, taking over the presidency of the G20 seems to be a year of tremendous opportunity, especially for the developing world to see international cooperation across multilateral forums. Read our Mid-Review and Outlook 2023 to asses and make sense of 2023 so far - and to know what to expect in the world of geopolitics and public policy for the remaining of the year!