A Blueprint for Responsible, Resilient Growth

A Blueprint for Responsible, Resilient Growth

Technology and Artificial Intelligence (AI) are reshaping global production, trade, and services, from digital payments and automated manufacturing to precision healthcare and advanced defence systems. For India to realise its Viksit Bharat vision, fully harnessing this technological transformation is essential.

With this backdrop, CII has presented its recommendations for the Union Budget 2026-27 calling for a coherent reform agenda to build a resilient AI and technology ecosystem anchored in robust governance, global standards, and strong industry-government collaboration.

Together, six priority pillars: responsible AI governance, compute and data access, skilling, digital infrastructure, intellectual property, and technology commercialisation, frame CII’s strategy for enabling this transition.

India’s AI ecosystem has expanded rapidly, supported by recent IndiaAI Governance Guidelines under the IndiaAI Mission. To translate this early progress into deeper, sector-wide adoption, a dedicated IndiaAI Safety & Standards Authority (IASSA) under MeitY would help ensure sector-wide implementation of responsible AI. Key functions would include the registration and evaluation of high-risk AI systems, accreditation of independent auditors, and maintenance of an AI Incident Registry interoperable with CERT-In.

High compute costs and limited availability of quality datasets remain major obstacles for AI start-ups and researchers. Addressing these constraints is essential for expanding India’s innovation base. A National AI Compute Grid, developed through public–private partnership, along with incentives for AI data centres and clear anonymisation rules under the DPDP Act, would address these gaps.

A National AI Skilling Mission focused on certifying competencies in Responsible AI, security, and risk governance alongside expanded Centres of Excellence in Tier-2 and Tier-3 cities, would democratise access to advanced AI capabilities.

Complementing these talent efforts, India must also strengthen the digital foundation on which innovation depends. A PPP-led investment framework for data centres, fibre backbones, and 5G networks is essential to realising India’s $1-trillion digital economy aspiration by 2030. This approach should include Viability Gap Funding, concessional finance for capital-intensive projects, revenue-sharing models, and streamlined land and utility facilitation through coordinated State-Centre mechanisms. Mandating the integration of green energy will help keep India’s data centre expansion sustainable.

Extending Digital Public Infrastructure (DPI) notably Aadhaar, UPI, and ONDC to logistics, healthcare, and education will deepen the country’s digital transformation. Such expansion will enable both efficiency gains and more equitable access to services.

A dedicated allocation of ₹10,000 crore can support interoperable platforms for freight movement and warehousing, strengthen the Ayushman Bharat Digital Mission, and enhance open digital learning systems. An additional outlay of ₹1,000 crore can accelerate regulatory digitisation through initiatives such as a Unified Enterprise Number, Entity Locker, API-based compliance, upgraded e-Gazette and India Code, and the National Regulatory Compliance Grid, helping reduce friction and improve transparency.

Strengthening intellectual property frameworks will be crucial for grassroots innovation. To support innovators who lack the resources for traditional patenting, a Second-Tier Patent System covering incremental innovations or utility models would enable faster, lower-cost IP protection for startups and small enterprises, mirroring successful systems in Japan and South Korea.

India’s universities and public research institutions hold significant untapped intellectual property that seldom reaches commercial scale. Converting this research strength into market-ready innovations will require targeted support. A Patent Commercialisation Fund offering grants or soft loans for pilot production, validation, and scaling can bridge this gap. Existing schemes such as MSME Innovative and PACE should include a dedicated commercialisation track to streamline access and reward successful transitions from lab to market.

As the government prepares the Union Budget 2026–27, advancing these reforms across AI governance, digital infrastructure, skilling, and intellectual property will be crucial to strengthening India’s technological capacity and global competitiveness.

A forward-looking Budget that supports responsible innovation, expands access to compute and data, and accelerates digital public infrastructure can position India as a global leader in the AI-driven economy and drive inclusive, long-term growth.

Note: This article was first published in The Hindu Business Line