The Indian government is reportedly keeping a close watch on the rapid rise of DeepSeek’s artificial intelligence model to the top of app store rankings, amid concerns over data security and citizen sovereignty, especially given the company’s Chinese origins. Meanwhile, more Chinese AI apps are on the horizon—Alibaba recently unveiled the latest version of its AI model, Qwen, claiming it surpasses DeepSeek in capabilities.
“The government at the very least needs to initiate a high level investigation as to the extent of data mining and web scraping undertaken by DeepSeek AI as its model raises serious security concerns especially since the servers are located in China and authorities in other countries like Belgium, France, Italy, South Korea, Ireland have already initiated such investigations focused around privacy concerns relating to the breach of data privacy of their citizens,” said Salman Waris, managing partner at Techlegis.
India to host its own AI app and AI infrastructure
The Indian government is set to host an open-source AI model similar to DeepSeek on domestic servers, Information and Broadcasting Minister Ashwini Vaishnaw announced on Thursday.
“The team has already finalized the server requirements and capacity needed. All the details have been worked out, and we will be hosting these open-source models on Indian servers very soon,” Vaishnaw stated. This development comes as Chinese startup DeepSeek, with its open-source reasoning model R1, challenges the notion that building frontier AI models requires access to vast GPU resources.
India is still taking baby steps to build AI infrastructure.This is a serious concern amid DeepSeek AI development that has shaken the technology industry. “We need to look at India’s AI readiness and introspection. The bigger play in AI capabilities for countries is the AI infrastructure, in managing and building AI and machine learning operations. The government urgently needs to look at this and make necessary investments, a lot of money needs to be deployed for this right now so that we can catch up with China over the next few years,” says Waris.
AI models often avoid controversial topics to align with local norms, raising concerns about censorship and transparency. Robust governance, diverse datasets, and ethical oversight are essential to address growing biases and future dilemmas.
Regulating AI in India
Unlike the EU, which came up with a comprehensive AI law that will eventually become a global template, India does not have a dedicated regulatory framework specifically for artificial intelligence (AI). The Ministry of Electronics & Information Technology (MeitY) oversees AI-related policies and has set up committees to draft guidelines for AI governance. Additionally, the Ministry of Commerce and Industry has formed an Artificial Intelligence Task Force, which is expected to play a key role in shaping future AI regulations.
India has introduced initiatives to promote responsible AI development, but there are no formal laws governing AI. Instead, existing legal frameworks—such as intellectual property and data protection laws—are applied to address AI-related concerns. The Indian government has also committed $1.2 billion to the IndiaAI initiative, aimed at strengthening the country’s AI capabilities.
Deepseek AI is already posing regulatory challenges and potential threat to data privacy the Italian Data Protection Authority has requested information from DeepSeek, citing potential risks to the data of millions of people in Italy in terms of the personal data collected to train its AI bot and also as to the legal basis of processing and storage of such data on servers located in China.
“AI governance is crucial at this stage to establish ethical standards, accountability, and transparency in AI systems. This includes addressing issues like bias, privacy, censorship and security. If the foundational principles of AI are not strongly entrenched in ethics and values at the time AI is a growing force, soon it will be too late to put the genie back in the bottle,” says Anupam Shukla, Partner, Pioneer Legal.
While comprehensive international laws are still developing, agreements like the 2024 Framework Convention on Artificial Intelligence, signed by the US, EU, and UK, aim to regulate AI with a focus on human rights, democracy, and ethical principles. Such initiatives are early steps toward unified global AI governance.
Legal Challenges & OpenAI’s Case in India
India’s lack of AI-specific regulations has led to legal battles under existing laws. One notable case involves OpenAI, which is facing a copyright infringement lawsuit filed by an Indian news agency- Asian News International (ANI). OpenAI has argued that its services are governed by U.S. laws and that Indian courts lack jurisdiction over its operations, as it has no data centers in India. However, Indian lawyers counter this argument, citing past rulings against foreign tech firms like Telegram.
The Delhi High Court is set to resume hearings on this case in February. If OpenAI loses, it may be required to delete training data and pay damages, setting a major precedent for AI regulation in India.
