1 hr ago
Sitharaman Seeks Stronger AI Safeguards Without Stifling Innovation
Nirmala Sitharaman said artificial intelligence can be useful in finance but can also create serious problems.
AI may help find fraud more quickly, but criminals could also use it to launch bigger cyberattacks.
Newer agentic AI systems can take actions instead of only making suggestions.
She said people and institutions must remain responsible for important AI decisions.
Riskier AI systems should receive more checks before and after they are used.
She also said safety rules should not unnecessarily stop helpful innovation.
Sitharaman suggested a joint platform to help Indian technology companies understand rules in other countries.
She said those companies should pay taxes in the places where they make profits.
Finance Minister Nirmala Sitharaman called for stronger accountability and safeguards as AI expands into finance and other critical sectors.
She warned AI could speed up financial decisions while also amplifying fraud, cyberattacks and systemic failures.
Sitharaman said higher-risk AI applications require human oversight, review, explanation and appeal before and throughout deployment.
She urged regulators to protect essential safeguards without blocking responsible innovation, particularly as agentic AI begins taking direct actions.
She proposed a federated platform for Indian technology companies and said firms must pay taxes where they generate profits.
- Who
- Finance Minister Nirmala Sitharaman, regulators, company boards, senior management and technology companies.
- What
- Sitharaman called for stronger AI accountability, human oversight and safeguards while supporting responsible innovation.
- Where
- The remarks were made at the Global Fintech Fest in Mumbai.
- When
- Friday; one report identifies the event as the Global Fintech Fest 2026.
- Why
- AI is expanding into finance and can accelerate decisions while also increasing the speed and scale of fraud, cyberattacks and other failures.
Prioritize Safety
Protect Innovation
AI regulation
Prioritize Safety
Regulators and companies should impose strong safeguards, human oversight, review, explanation and appeal for consequential AI decisions.
Protect Innovation
Rules should distinguish essential safeguards from wasteful operational friction so they do not block useful AI adoption.
Agentic AI deployment
Prioritize Safety
The rapid spread of AI that can take direct actions requires continuously updated safeguards before risks are left for society to manage.
Protect Innovation
AI should continue developing and being adopted, provided institutions manage risks rather than treating safety and efficiency as competing goals.
Key facts
- Speaker
- Nirmala Sitharaman, Finance Minister
- Event
- Global Fintech Fest 2026
- Main concern
- AI could amplify fraud, cyberattacks and systemic risks in finance.
- Oversight principle
- Responsibility for AI decisions must remain human and institutional.
- High-risk systems
- They should receive stronger scrutiny before deployment and throughout their life cycle.
- Industry proposal
- A federated platform could help Indian technology companies navigate international regulations.
- Taxation
- Technology companies should meet tax obligations in jurisdictions where they generate profits.
Quotes
Nirmala Sitharaman
India’s Finance Minister
“AI acts as a double-edged sword. It helps us spot fraudsters and fraud faster, but it also allows attackers to automate larger attacks with more sophisticated cyber-attacks”
livemint.com
“Efficiency and safety should not be competing objectives; good institutional design must make them mutually reinforcing.”
rediff.com
Sources
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