Department of Promotion of Industry and Internal Trade published Part 1 of its working paper examining the intersection of generative artificial intelligence (AI) and copyright law. The paper captures the recommendations of an eight-member committee constituted by DPIIT (Committee) on April 28, 2025, for assessing the adequacy of the existing law to address the issues raised by generative artificial intelligence and make recommendations on amendments to the law, if necessary.  

The working paper assesses the existing approaches including blanket exemptions, text and data-mining exceptions with or without an opt-out right, voluntary licensing, or extended collective licensing. Owing to the suitability concerns with respect to all these models, explained in the paper, the working paper proposes a new policy framework aimed at striking the balance between the rights of content creators and AI innovators.

Rejecting the zero price license model, the Committee argues that the same would undermine incentives for human creativity and could lead to long-term underproduction of human-generated content.

As an alternative, the Committee proposes a hybrid model under which:

AI developers receive a blanket licence for the use of all lawfully accessed content for training purposes, without requiring individual negotiations.

Royalties become payable only upon commercialisation of the AI tools, with rates set by a government-appointed committee. The rates would be subject to judicial review. 

A centralised mechanism handles royalty collection and distribution, aiming to reduce transaction costs, provide legal certainty, and support equitable access for both large and small AI developers.

A valuable contribution was made by Dr Raghavender G R whose support was instrumental in preparing the working paper.