Mandatory Blanket Licence For AI Training? Understanding DPIIT's Landmark Proposal On Copyright And GenAI

1. Introduction

India has taken a decisive step toward establishing a structured legal architecture for artificial intelligence (AI) development and copyright governance. On 8 December 2025, the Department for Promotion of Industry and Internal Trade (DPIIT) released Part I of a Working Paper prepared by an expert committee constituted earlier this year. The paper presents the Government's first comprehensive proposal to regulate the use of copyright-protected works for AI training, and invites stakeholder comments within 30 days.

At the core of the proposal is a mandatory blanket licence allowing AI developers to use all lawfully accessed copyrighted content for training AI systems, accompanied by a statutory remuneration right for copyright holders. This hybrid approach attempts to bridge the growing tension between rapid AI innovation and the protection of human creativity.

2. Background: Why a Regulatory Intervention Was Needed

India's current copyright framework does not explicitly address AI training practices. Generative AI models typically rely on massive datasets, including literary works, images, sound recordings and audiovisual material, often scraped from the Internet or purchased through intermediaries. This has led to global debates about:

1. Unauthorised reproduction for training datasets
2. Economic harm to authors and creators
3. Opaque outputs of AI systems that may replicate copyrighted content
4. High transaction costs for licensing large datasets

Recognising these challenges, the DPIIT constituted an eight-member expert committee on 28 April 2025, headed by Additional Secretary Himani Pande, comprising legal experts, industry representatives, and academic specialists. Its mandate included:

1. Identifying copyright issues raised by AI systems
2. Assessing the adequacy of India's existing regulatory framework
3. Recommending statutory and policy reforms
4. Preparing a working paper for stakeholder consultation

3. The Committee's Key Recommendation: Mandatory Blanket Licence

The working paper reveals a majority view within the committee: India should adopt a mandatory blanket licensing model for AI training. The central features include:

1. Lawful Access as the Threshold: AI developers may use any copyrighted work to which they have lawful access, such as purchased books, subscribed databases, authorised online content, or publicly available materials.
2. Compulsory Nature of the Licence: Copyright owners cannot opt out of their works being used for AI training. This eliminates the need for individual negotiations and prevents data access bottlenecks.
3. Statutory Remuneration for Copyright Holders: In exchange for deprived exclusivity, rightsholders receive a mandatory royalty, administered by a government-designated "umbrella organisation" formed by rightsholders themselves.
4. Single-Window Access for AI Developers: AI companies, including start-ups and MSMEs, obtain a streamlined licensing interface to access all copyrighted works needed for training.

4. Rationale: Balancing Innovation and Copyright Protection

The committee acknowledges two competing imperatives:

1. AI systems require enormous volumes of high-quality data, and licensing content individually is costly, slow, and unviable.
2. Human creators must not be deprived of compensation and control over commercially exploited works.

The proposed blanket licence aims to address both, high-volume access for developers and fair remuneration for rightsholders.

The paper warns that without such a model, prolonged negotiations and high transactional costs could significantly hinder innovation, particularly for start-ups and MSMEs, which are the backbone of India's technology ecosystem.

5. Features of the Hybrid Blanket Licensing Model

The working paper outlines a hybrid mechanism with the following attributes:

1. Guaranteed Availability of Content: All lawfully accessed copyrighted works become available for AI training as a matter of right.
2. Reduction of Transaction Costs: Businesses avoid time-consuming negotiations with multiple rightsholders, enabling cost-effective compliance.
3. Judicial Oversight of Royalty Rates: Courts will retain supervisory jurisdiction to ensure royalty rates remain fair, reasonable, and non-discriminatory.
4. Ease of Payment and Compliance: The umbrella organisation will collect and distribute royalties, easing the compliance burden on AI developers.
5. Level Playing Field: Start-ups and smaller AI companies benefit from predictable, affordable access to training datasets.

6. Implications for Stakeholders

1. For Copyright Holders: the proposed framework offers the advantage of guaranteed remuneration through a statutory royalty model, ensuring that creators receive compensation whenever their works are used for AI training. However, this comes with a corresponding reduction in individual control, as rightsholders will no longer be able to exclude their works from the licensing regime. To effectively benefit from the system, copyright owners will need to participate in or coordinate with the designated umbrella organisation, which will be responsible for royalty collection and distribution. The model also has the potential to enhance transparency, providing creators with better visibility into how their works are being used within AI training ecosystems.
2. For AI Developers: For AI developers, the framework offers significant procedural and legal advantages. They will enjoy broad access to large-scale training datasets without the need for negotiating individual licences, removing a major operational bottleneck. Compliance obligations will be greatly simplified through a centralised mechanism, reducing administrative complexity. Importantly, the uniform licensing structure will help reduce legal uncertainty and exposure to litigation, providing a clearer pathway for responsible AI development.
3. For Start-ups and MSMEs: For start-ups and MSMEs, the model is particularly beneficial. It substantially lowers entry and operational cost barriers, enabling smaller innovators to compete on more equal footing with large global players. By standardising access and royalty obligations, the framework establishes a predictable regulatory environment that supports long-term planning, product development, and investor confidence, critical factors for early-stage technology companies.
4. For Policy and Regulatory Bodies: For policymakers and regulatory authorities, the proposed system introduces the need for robust judicial oversight, particularly in determining and reviewing royalty rates. It also requires the creation of clear, detailed guidelines governing royalty collection, distribution, and dispute resolution. Further, regulators will need to undertake updates to existing copyright rules to ensure full alignment with the blanket licensing framework and to support coherent, future-ready governance of AI and digital content.
5. Legal and Policy Challenges Ahead

While progressive, the proposal raises several important legal and jurisprudential issues:

1. Compatibility with the Berne Convention and TRIPS: India must ensure that any statutory licensing scheme aligns with international copyright obligations, particularly the three-step test.
2. Determination of Royalty Rates: Setting rates that are equitable yet non-prohibitive will require economic and statistical analysis.
3. Scope of "Lawful Access": Ambiguities around scraped content, cached pages, and user-uploaded materials on platforms must be clarified.
4. Protection Against Reproduction in Outputs: Mechanisms may be required to prevent AI models from generating content that closely replicates copyrighted works.
5. Enforcement and Audit Rights: Rightsholders may seek rights to audit training datasets or the royalty distribution process.

7. A Turning Point for India's AI and Creative Economy

The working paper marks a foundational step in India's attempt to modernise copyright law for the AI era. It recognises that:

1. Innovation requires frictionless access to large datasets
2. Creators require statutory guarantees of compensation
3. India must build a balanced regulatory architecture that encourages AI growth while safeguarding its creative economy

The blanket licence proposal, if adopted after stakeholder consultation could position India as a global leader in pragmatic, innovation-friendly AI regulation.

8. Conclusion

India's proposed hybrid blanket licensing system is a bold, forward-looking attempt to harmonise copyright protection with AI development needs. By creating a single-window mechanism for dataset access and ensuring fair remuneration, the proposal aims to support India's ambition to become a global AI innovation hub.

Stakeholders across industries, publishers, creative sectors, AI companies, MSMEs, legal experts, and platforms are encouraged to provide feedback. The final framework, shaped through this consultative process, will determine how India balances creative rights and technological progress in the years ahead.

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