India is preparing for a significant shift in how AI companies can use content created within the country, and the move feels like an attempt to set the rules before the rest of the world settles into its own version. A government-appointed panel has put forward a direct idea with huge consequences: if companies such as OpenAI or Google train their models on Indian content, they should pay for it. Not through vague commitments or symbolic gestures, but by sharing a portion of their earnings with the creators whose work forms the backbone of these AI systems.
This position is clearly different from what we see in the United States, where “fair use” is often used as a blanket justification that lets companies rely on publicly available material without compensating anyone. India is leaning toward something more structured and more intentional. A central organisation would collect the money from AI companies and distribute it to creators, sparing individuals from the impossible task of tracking where their work ends up inside massive and often opaque datasets. The government has now invited the public and the industry to give their feedback over the next 30 days before anything is finalised.
The panel, formed earlier this year in the month of April, made its stance unambiguous as it clearly stated that if AI models benefit from Indian content, the companies behind them should contribute to a dedicated fund. Creators would be compensated automatically, without needing to monitor usage or audit datasets. An opt-out system was rejected because it would be too difficult to enforce and too complicated to keep accurate.
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When you look at the global landscape, India’s strategy stands apart, as in the United States, AI developers can use publicly accessible content without paying for it. Japan takes an even broader approach, allowing widespread use of material for AI training. The European Union gives creators the right to opt out entirely. However, India is looking forward to building a system where creators receive payment without having to chase down every instance where their work may appear.
Reactions from the tech industry are understandably mixed. Nasscom, which represents companies like Google and Microsoft, said that required royalties are like a “tax on innovation” and could slow down progress. The Motion Picture Association, which includes Netflix and Paramount, said that current copyright laws are enough and that licensing deals could solve many problems. AI companies like OpenAI and Google Gemini haven’t commented publicly yet.
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All of this is unfolding while OpenAI is reportedly facing a lawsuit from Indian news agency ANI for using copyrighted material without permission. If India decides to move ahead with this royalty-based system, it could become a model for other countries that are trying to figure out how to regulate the data that feeds modern AI models. However, as per the current reports, the policy is still in draft form, as the government will review the feedback, balance the priorities of creators and the tech sector, and decide how India wants to shape the future of AI content usage both within the country and across the world.