Written by Syed Zia Ur Rahman, Intern at JLS LAW — June 2026
Abstract
Artificial Intelligence (AI) is no longer a concept from science fiction — it is already deeply embedded in daily life, from search engines to medical diagnosis, lending decisions and the early use of technology in courts. This article explores the key legal challenges AI poses: liability, intellectual property, privacy, bias, and the need for regulation. Drawing on the Indian legal framework and international developments, it argues that a balanced, forward-looking legal approach is necessary to govern AI without stifling innovation.
I. Introduction
We live in an era where a computer program can write a poem, diagnose cancer, drive a car, and even argue a legal point. India’s AI market was valued at roughly USD 6 billion in 2023, with projections suggesting it could reach USD 17 billion by 2027. Yet the law governing this technology remains fragmented and incomplete — there is no dedicated AI legislation in India, and the Information Technology Act, 2000, the Bharatiya Nyaya Sanhita, 2023, and sector-specific rules were never designed with AI in mind. This article focuses on four areas: liability for AI-caused harm, intellectual property in AI-generated content, data privacy and surveillance, and the broader question of regulation.
II. Liability for AI-Caused Harm: Who Is Responsible?
When an autonomous system causes harm — say, a self-driving car injures a pedestrian — is the manufacturer, the software developer, or the owner responsible? India’s Motor Vehicles Act and Consumer Protection Act were not written with AI in mind, and the Consumer Protection Act only helps if a specific defect can be identified and linked to the harm, which is difficult with systems that learn and evolve. The EU’s proposed AI Liability Directive moves toward strict liability with a presumption of causality favouring the injured party — an approach India could adapt for high-risk AI in healthcare, criminal justice and autonomous systems.
III. Intellectual Property and AI-Generated Content
Who owns a painting made by AI, or holds copyright over an algorithm-composed song? India’s Copyright Act, 1957 defines “author” around human creation, though Section 2(d)(vi) attributes computer-generated works to the person who caused them to be created — a provision written well before modern generative AI, but one that offers a possible foothold. A deeper unresolved question is training data: large models are trained on vast copyrighted text and images, and India, unlike the US and UK where lawsuits are already underway, has no clear position on whether such training requires a licence.
IV. Data Privacy, Surveillance, and AI Bias
India’s Digital Personal Data Protection Act, 2023 imposes purpose-limitation, data-minimisation and consent obligations on those processing personal data, building on the Supreme Court’s recognition of privacy as a fundamental right in Justice K.S. Puttaswamy v. Union of India (2017). Enforcement remains uncertain for AI systems that aggregate data or draw inferences beyond original consent. Facial recognition is now widely used by Indian law enforcement with little specific legal oversight, despite research showing higher error rates for women and people with darker skin tones — a reminder that AI trained on historically unequal data can reproduce and amplify that inequality in lending, hiring and sentencing.
V. The Regulatory Landscape: Where Does India Stand?
The EU AI Act (2024) classifies systems by risk level with proportionate requirements; the US relies on executive orders and sector guidance; China has enacted specific rules on recommendation algorithms and generative AI services. India’s National Strategy for Artificial Intelligence (NITI Aayog, 2018) framed AI mainly as a development opportunity, and the forthcoming Digital India Act is expected to touch on AI-related issues, though details remain unclear. Indian courts — the Madras High Court in particular — have begun engaging thoughtfully with algorithmic accountability in content moderation, even without a landmark ruling on AI liability itself.
VI. The Way Forward: Towards a Balanced AI Law for India
India needs dedicated AI legislation — not a general digital law that mentions AI in passing — built on a risk-based approach similar to the EU AI Act. The liability framework should shift toward strict liability for high-risk AI-caused harm, placing the burden on those best placed to prevent it. AI bias should be treated as a civil-rights issue, backed by mandatory audits for high-stakes uses in lending, employment and criminal justice. And the Copyright Act should be modernised to address AI training data and the status of AI-generated works, with India engaging actively at forums like WIPO.
VII. Conclusion
The law has always adapted to new technology, from the printing press to the internet. AI may not be different in kind, but it is different in scale and speed. India has a real opportunity to build a legal framework that is both innovation-friendly and rights-protective — one where AI’s benefits are widely shared and its harms fairly addressed. The window for thoughtful, proactive regulation is open, but it will not stay open forever.