Big tech blasts DPIIT copyright AI policy reflects growing industry pushback against proposed rules that redefine how training data, model outputs and intellectual property obligations are handled in India. The main keyword anchors the opening as technology companies warn that the policy could slow innovation and strain the startup ecosystem.
Industry objections and secondary keywords highlight compliance anxieties
Large global technology firms have raised concerns that the proposed copyright framework introduces compliance burdens that are not aligned with global AI standards. They argue that mandatory licensing requirements for training data and obligations to track copyrighted content across models could be technically unfeasible at scale. Companies developing generative AI models rely on broad datasets, and the policy’s restrictive clauses could limit their ability to improve accuracy, safety and performance. Big tech representatives have communicated that implementing detailed traceability across model layers would increase operational costs and slow down product development.
Domestic startups echo similar worries, emphasising that the policy may unintentionally favour only the largest firms with deep legal and engineering resources. Smaller AI companies could face higher barriers to entry, especially those building models for enterprise and consumer applications. The uncertainty around permitted use of publicly available content, exceptions for research and obligations around derivative outputs has created hesitation among founders who are planning investment cycles for 2025 and 2026.
Potential impact on India’s AI innovation roadmap
India aims to position itself as a major global AI innovation hub, and policymakers have emphasised responsible development as a strategic priority. However, stakeholders believe that an overly restrictive copyright framework could conflict with these ambitions. AI development depends on access to diverse datasets and flexible experimentation environments. If the rules narrow the definition of permissible data or impose liability for unintentional reproduction of copyrighted elements, AI research institutions may struggle to scale their work.
Technology associations have pointed out that countries competing for AI leadership have adopted more flexible copyright carveouts for training data and model optimisation. They caution that India risks creating a fragmented regulatory environment that discourages cross border partnerships. Investors monitoring the AI sector have also flagged that unclear copyright obligations may affect valuations of startups working on foundational models or large scale enterprise AI tools. The uncertainty could slow fundraising activity at a time when AI adoption is accelerating across healthcare, financial services, manufacturing and logistics.
Concerns from the startup ecosystem and product builders
Startups warn that the policy could create legal ambiguity around product deployment. For example, AI tools that generate text, images or code may inadvertently incorporate elements from copyrighted materials used during training. Under the current wording, the liability for such outputs remains unclear. Entrepreneurs fear that this could lead to a wave of compliance disputes or legal actions that discourage innovation.
Founders also highlight that building proprietary datasets is costly and impractical for early stage companies. If publicly available data falls under restrictive copyright obligations, India may see fewer homegrown AI models and greater dependence on foreign platforms. This would contradict national goals of developing indigenous AI capacities. Collateral challenges may arise for sectors such as edtech, agritech and logistics, where models rely on dynamic data sourced from open repositories. Restrictive rules could reduce the quality of models and slow down product iteration cycles.
Policy pathway and the challenge of balancing copyright with innovation
The DPIIT faces the difficult task of balancing creator rights with innovation incentives. Content creators have long demanded protections against unauthorised scraping and AI generated reproductions of their work. The proposed rules attempt to address these concerns but the language may require refinement to avoid unintended consequences. Policymakers are expected to engage with stakeholders to clarify technical feasibility, define reasonable compliance thresholds and ensure that the law does not impair India’s AI competitiveness.
Experts suggest adopting a tiered framework where foundational model developers, application layer startups and content platforms have differentiated obligations aligned with their scale and capabilities. Clear safe harbour provisions would help reduce litigation risk for early stage companies. The government may also consider global best practices such as fair use style exceptions, research exemptions and transparency disclosures that do not compromise proprietary model architecture. Achieving the right balance will be critical for maintaining investor confidence and ensuring that India’s AI ecosystem continues to grow sustainably.
Takeaways
Big tech and startups warn that the proposed AI copyright rules could slow innovation.
Compliance obligations around data licensing and output liability may be technically unfeasible.
Startups fear higher entry barriers that could weaken India’s AI competitiveness.
The DPIIT is expected to refine the policy to balance creator rights and industry needs.
FAQs
Why are big tech companies opposing the DPIIT policy
They believe the proposed copyright rules impose heavy compliance burdens and restrict access to training data essential for AI development.
How could the policy affect Indian startups
Startups may face legal ambiguity, higher operational costs and reduced access to datasets needed to build competitive AI products.
Does the policy address creator rights
Yes, it aims to protect creators but may need adjustments to ensure that safeguards do not impede technological progress.
What changes could improve the policy
Clear exemptions for research, proportional compliance requirements and safe harbour protections for smaller companies could help balance interests.
