As India looks to regulate artificial intelligence (AI) and emerging technologies from the prism of user harm, Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said the country’s contribution in shaping regulations around AI globally would be significant and not trivial. In a conversation with Anant Goenka, Executive Director of The Indian Express Group, at the financialexpress.com Digital Bharat Economy Conclave held recently, Chandrasekhar talked about the big tech companies, the recent Twitter controversy, valuation of Indian startups, the CoWIN-linked data breach, and mobile phone manufacturing in India. Edited excerpts from the conversation:
Q. Technology was brought into India by some very large corporates from Silicon Valley eight years ago. Do you think more than dealing with technology, we were trying to process how to deal with these companies?
Rajeev Chandrasekhar: No, I think eight years ago or even before, we all had a deep intuitive sense that technology is a force for good, technology is going to change the way our future is going to unfold in front of us. So, we had a lot of these macro 80,000-feet, above-sea-level type of intuition and instinct about the power of good that technology would deliver. Then came along these big platforms that were not so big at that time. We allowed them to grow unfettered because they, in a lot of ways, masqueraded and behaved as innovators and innovation on the move. Therefore, governments, people, citizens, all of us, including the media, looked at this as a good thing. There was really no narrative that opposed it in any way. Eight years ago, all of these things that we are grappling with today, both opportunities and challenges, really didn’t occur to us. We only saw technology being good, gooder, and goodest.
What was the turning point you think when these companies became not good, gooder, or goodest?
I have actually tried to do some homework on this and research on it, especially after I was given the opportunity to serve as a minister. There was no single inflection point where suddenly the social media platform, that was a warm, fuzzy place for all of us to meet and greet friends, became this platform for user harm, doxing, gaslighting, and all kinds of new user harms. There was no certain sudden one moment where Google became something other than just convenience and a convenient way to crawl the Internet. But certainly over time, as they have become more and more profitable, they have become financially more powerful. They have also started becoming more and more powerful presences on the Internet. In many ways, these platforms have carved out islands where they are almost dominant. So, there’s a search island, there’s a social media island. These, in a way, have come and crept on us without us really seeing the trend, seeing a pattern, seeing a design. I don’t think they set out to do this world domination either; it just so happened that they became what they became.
Your relationship with Twitter has also been quite exciting.
I am very candid and clear on this. My relationship or the government’s relationship with any platform is really simply through the prism of compliance with the law and compliance with the rules. So, there is nothing personal, there is nothing adversarial against one platform or the other. But we, including my predecessors and my successors, will certainly ask for only one thing, which is that regardless of whether you are a big platform, small platform, foreign platform, or Indian platform, the respect for Indian laws is totally an uncompromising ask on the part of the government and the people of India.
With Twitter, on this recent controversy of Jack Dorsey’s statement, it is an outright lie because at no time in the history, specifically in the 2020-2022 period, has the Government of India ever done anything to Twitter despite the fact the platform was in violation of Indian law for a period of two years. The Government of India neither shutdown Twitter nor did it jail anybody, nor did it have any other punitive consequences imposed on Twitter. It is ironic because I have to quote inaction on the part of the government against a violation of law to outright lie that Jack Dorsey has put out there.
There is this level of swag or this level of irreverence that these Silicon Valley founders sort of carry with them.
I think a lot of this has to do with the fact that governments around the world have considered them as great creators and innovators and considered them as gods of the Internet. Therefore, they have, in a sense, escaped oversight, escaped the demand for compliance with the law for several years, not just in India, all around the world. You saw that in the crypto space. With Twitter, specifically, two things that are quite there in the public domain now is that they believe they are a sovereign entity and, therefore, laws of any nation do not apply. Of course, we swiftly disabused them of that. In India, we are a democratic country, we live by the rule of law and regardless of whether you are in San Francisco or Menlo Park or Bengaluru or Hyderabad, the rule of law applies to you as well. Second, I think with the Twitter files, the expose that we’ve seen in early 2023 and late 2022, it also has become very clear that these platforms require more oversight because of the kind of arbitrary and abuse of power, and misuse of power that they exercise. So, a lot of this stuff about Twitter that is now in the public domain reinforces the need for governments all around the world, including in India, to have very clear guardrails and dos and don’ts.
In the last eight years, America has done digital with innovation, China has done digital with imitation, and Europe has done digital with regulation. Is there one word that you think India will do with digital?
I use a phrase. Digital leads India, India leads digital. And when I look at the young Indians, I say you will lead digital India. So, there are these three real things that are happening that certainly the digital economy and innovation are going to be a much bigger and significant part of the overall economy. The digital economy as a percentage of GDP was about 4% in 2014; we are close to 10% today. By 2026, the digital component will be 20% of the GDP. India will certainly lead digital in the world.
There is a certain correction in valuation for a lot of big tech startups and unicorns in India. How closely are you watching it?
If you just look at the trend line, it is solid growth despite all these occasional meltdowns you had in the early 2000s, we saw the Internet bubble burst. Those types of valuation corrections will always follow. I think, now, the hot thing is AI. Anybody who has an AI startup can command his or her value. Semiconductor startups and AI compute startups are now seeing value. I think that is part of the technology ecosystem. As people see a certain trend, a certain new disruption, capital will fly towards there, valuation bubbles will be formed, then it will correct. That is, in my opinion, part of the DNA of the technology ecosystem. Now, are many startups going bust, are many people running out of capital today? That is again, in my opinion, the very nature of being in a startup ecosystem. That type of volatility, succeed or fail, is part of what startups are. I don’t see anything dramatically different except that, post the Ukraine-Russia war, there is a certain risk aversion that has emerged for the equity class as a whole. And, therefore, there is less capital that is running after private equity deals.
Byju’s is the largest startup in the country and raised money recently at a valuation of $22 billion. They are now talking about raising debt. Does it concern the government when a company becomes so big and jobs are at stake?
On this particular area of an investee’s ask and an investor’s response to that ask, really governments cannot come into. It’s private capital going after private opportunity. There’s a fundamental right for everybody to make mistakes. If somebody wants to make an investment based on a particular narrative or tech that there’s an untapped market for education that is so big in India and I have size and scale, I have market dominance for that market and I think $20 billion valuation is fine and the other side accepts it, who is the government to come in between? That is the model, we will not certainly step in to arbitrate or moderate or intermediate on valuation. It’s a private deal.
Is India ready for artificial intelligence?
We are ready. Our approach towards artificial intelligence is what the honourable prime minister said almost two years ago. He said, ‘India for AI and AI for India’. AI has tremendous possibilities for the digital economy and for governance. We look at AI being a kinetic enabler of our digital economy. It’s a layer of work on what we are already doing with data, on what we are already doing with applications and the consumer Internet. We certainly today are in a position to bring to bear one of the largest and most diverse data sets in the world. The enormity of what Indian AI can be and the presence of India in the global AI is, I don’t think, will be trivial, it will be pretty significant. Sam Altman also came to Delhi recently. There are many narratives on AI disrupting jobs and would cause problems to users. I believe AI currently is at an early stage, it is only going to enable task efficiencies, getting things done faster, getting things done with more intelligence, rather than replace humans. Current AI models are far from it. At what stage does AI certainly start replacing full jobs? I don’t think today anybody who has a reasonable view of AI can say it will happen five years from now, four years from now. But certainly, today, in many job roles, AI knowledge, using large language models, using ChatGPT type models, will become part of the skill requirement.
We have still not found any one ubiquitous AI application coming from India. Do you agree?
Yes, absolutely.
Do we accept that America will always be ahead in innovation?
Silicon Valley is an innovation hotspot that nobody can take away from it. At best, what we in India are trying to do today or the rest of the world is doing is that we can try and be a competing destination for innovation. But for us to assume that suddenly Silicon Valley is going to go to sleep, that’s not going to happen, that’s impossible. It is not just about innovation and numbers, it also is about billions of dollars of AI compute capacity and that they have built, they have invested in. When Sam Altman was here, he talked about how you may have great datasets, you may have great innovators, you may have a great startup ecosystem, but you certainly need to also focus on the AI compute capability. On AI regulation, we are talking about user harm regulation and the other country we were in talks with about use case regulation. At the end of the discussion, they agreed that our approach towards user harm regulation is probably a better way to harmonize two countries’ approach towards AI regulations.
Apple is a big brand operating out of India. How happy are you with the journey of smartphone manufacturing in India and other electronic manufacturers?
Everybody in India should be extremely excited about these huge factories that are coming into India. Today, we are manufacturing almost 100% of the mobile phones we consume in India. Today, we have a situation where we are exporting. What Tim Cook said was that we were able to ramp up so quickly in India. It is because of all the work that had gone into policy making and creating an enabling environment leading up to that.
One of the risks is data getting stored and then data breaches happening. For example, the recent CoWIN-related data leak incident. How can we prevent this?
I want to be very clear on this, that the so-called breach was not a breach of CoWIN. The data that the Telegram bot was throwing up was not from CoWIN. I am emphatically repeating so that nobody should mistake this and label this as a CoWIN data breach. I just want to explain to you how easy it is to mimic a breach and while CERT-In is still investigating this, we believe that this database that the Telegram bot was throwing up was from the database owned by the person who owned the bot. To the broader question, we are making a lot of effort. We have made a lot of effort, even before my time, my predecessor and his team and other ministries to ensure that every app, every application within the government follows a standard protocol in terms of data storage, data security, data access, and that has been now made into a policy called the National Data Governance Policy. The Digital Personal Data Protection Bill, which is the legal framework, will hopefully be introduced in the July session of Parliament. It is an absolutely well thought of, well-written Bill that will create behavioral changes in everybody—private and public companies, the government in how they collect data, store data, manage data, and provide security for that data.