India’s proposed legislation requiring AI firms to pay royalties on copyrighted Indian content for training models marks a significant intervention in the global AI economy, raising questions about innovation, fair use, and international market dynamics.
India’s proposal to make artificial-intelligence firms pay royalties for using copyrighted Indian content to train models marks a striking assertion of regulatory power by a country that has quickly become central to the global AI economy. According to the report by Rest of World, the draft framework would require tech giants to pay a mandatory blanket licence , a percentage of global revenue , and create a government‑designated collecting body to distribute payments to creators. [1]
The Department for Promotion of Industry and Internal Trade’s working paper lays out a so‑called “One Nation, One Licence, One Payment” hybrid model that would give AI developers automatic access to all “lawfully accessed” copyrighted works for training in return for statutory remuneration, while prohibiting creators from opting out. The proposal argues this single‑window approach will reduce transaction costs and litigation risk, and produce a steady revenue stream for India’s vast and often informal creative sector. [2][6]
Officials behind the plan have made clear that royalties would be linked to firms’ global AI revenues rather than what they earn in India, a choice that amplifies the financial stakes for multinational developers and underlines New Delhi’s leverage as one of the world’s largest markets for generative AI services. Proponents say the measure would bring legal certainty where courts and regulators have yet to define whether large‑scale training constitutes fair use. [4][5]
Industry bodies and some legal experts have pushed back. Nasscom has formally dissented, warning mandatory licensing could slow innovation, and private lawyers such as Rahul Matthan have described the payment model as “deeply flawed,” arguing it risks concentrating proceeds with established rights‑holders while leaving small creators with little control or compensation. Matthan has urged a focus on downstream outputs , pursuing remedies when models reproduce substantial copyrighted passages , rather than blanket upstream licenses. [1]
The committee behind the proposal reasons that litigation is expensive, slow and uncertain, pointing to high‑profile, drawn‑out disputes elsewhere as evidence that preemptive licensing would spare creators and companies protracted court battles. The paper recommends a centralised non‑profit collecting entity, membership for collective management organisations, and a government committee to fix royalty rates and oversee distribution to both registered and unregistered creators. [3][6]
Practical challenges remain significant. Critics note the difficulty of measuring how much any single work contributes to a model’s output, the administrative capacity required to collect and equitably distribute royalties, and the risk that retroactive charges could hit nascent startups and smaller players disproportionately. The government counters that a mandatory blanket licence would lower compliance costs for startups by replacing countless individual negotiations with a single legal regime. [2][6]
The policy comes amid mounting global debate: Brazil’s draft AI bill includes compensation for rights‑holders, Europe and the United States are grappling with transparency and fair‑use questions, and private settlements , such as a major authors’ settlement reached in the U.S. , have already signalled that market pressures are shifting. India’s proposal therefore represents one of the most interventionist regulatory experiments to date and could become a template for other countries seeking to monetise locally produced training data. [1][5]
If New Delhi follows through, tech companies that have already committed billions to India will face a clear choice: absorb licence costs into their deployment and product models or forgo one of their fastest‑growing markets. The government’s approach underscores a broader tension between preserving incentives for creators and sustaining an open environment for AI innovation; how that balance is struck in India will be watched closely across capitals and courtrooms worldwide. [1][3][5]
Source Reference Map
Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative presents a recent proposal by India’s Department for Promotion of Industry and Internal Trade (DPIIT) regarding AI data licensing. The earliest known publication date of similar content is December 9, 2025, indicating the narrative is based on a press release, which typically warrants a high freshness score. ([techcrunch.com](https://techcrunch.com/2025/12/09/india-proposes-charging-openai-google-for-training-ai-on-copyrighted-content/?utm_source=openai))
Quotes check
Score:
9
Notes:
The narrative includes direct quotes from various sources. The earliest known usage of these quotes is from December 9, 2025, suggesting they are original to the narrative. Variations in wording across different sources have been noted, but no identical quotes appear in earlier material, indicating potential originality.
Source reliability
Score:
7
Notes:
The narrative originates from Rest of World, a reputable organisation. However, the specific author and their credentials are not immediately verifiable online, which introduces some uncertainty regarding the source’s reliability.
Plausability check
Score:
8
Notes:
The claims made in the narrative align with recent developments in India’s AI policy, including the proposed mandatory blanket licence for AI training on copyrighted works. The narrative provides specific details and references to official documents, enhancing its plausibility. ([hindustantimes.com](https://www.hindustantimes.com/india-news/dpiit-plan-licence-for-ai-training-on-copyrighted-works-101765307747526.html?utm_source=openai))
Overall assessment
Verdict (FAIL, OPEN, PASS): PASS
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The narrative presents a recent proposal by India’s DPIIT regarding AI data licensing, with no paywalled content detected. While the source is reputable, the specific author’s credentials are not immediately verifiable, introducing some uncertainty. The claims made are plausible and align with recent developments in India’s AI policy. Given these factors, the overall assessment is a PASS with MEDIUM confidence.
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