Market Updates And Recent Legal Developments In India

India has formally moved to regulate deepfakes and AI generated content by notifying the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules, 2026.

On June 3, 2026, the Supreme Court of India’s AI Committee released preliminary draft of the Regulations for Use of Artificial Intelligence (AI) in Courts, 2026 (“The Draft”). This marks a shift from scattered experiments with AI tools for translation, transcription, research and case management. With over 93,000 pending matters as of March 2026, the guidelines aim to ease processes for officials and citizens. AI could help reduce backlogs through automated cause-list preparation, transcription, research, and defect scrutiny, but its use also raises serious concerns.

The Supreme Court of India, through notice dated 03.06.2026, has published the draft Regulations for use of Artificial Intelligence in Courts, 2026 (“Draft AI Regulations”). Comments and suggestions from all stakeholders and the general public are invited on the Draft AI Regulations by 20.06.2026

Between May and August 2026, AI regulation has continued to develop rapidly, with a focus on accountability, transparency, human oversight and protection against AI-related harms.

In a rare use of its extraordinary powers under Article 142 of the Constitution of India, the Supreme Court heard a curative petition filed by DMRC, challenging an earlier order that had upheld the arbitral award. The judgment brings finality to a decade-long contractual dispute that began in 2013 with arbitration proceedings.

In a seismic event that has rattled the foundations of India's cryptocurrency landscape, WazirX, the nation's largest cryptocurrency exchange, suffered a devastating cyberattack that resulted in the theft of over $240 million in investor funds.

On May 21, 2025, the NPCI introduced new guidelines to streamline the Unified Payments Interface ("UPI") and its Application Programming Interface ("APIs"), effective August 1, 2025.

Cybersecurity regulation in India has, until now, largely spoken to the entity that suffers the breach. The 2022 CERT-In Directions issued under Section 70B of the Information Technology Act, 2000 fixed a six-hour reporting clock on the organisation that detects an incident. The new Guidelines flip the lens onto the entity upstream of that breach, the OEM or technology provider that built the product in the first place. For the first time, vendors supplying software, firmware, cloud platforms, or APIs into India carry direct, time-bound, and independently verifiable obligations of their own and not obligations that are merely passed through a customer contract, but obligations CERT-In itself may enforce.

On October 27, 2025, OpenAI published a report on its platform stating that approximately 0.15% of the ChatGPT users exhibit suicidal thoughts or psychosis and seek advice on way and methods of self-harm.

On 25 May 2026, the Indian Computer Emergency Response Team (CERT-In), under the Ministry of Electronics and Information Technology (MeitY), released its “Blueprint for Reducing Exposure and Defending against AI-Assisted Vulnerabilities Exploitation in Digital Infrastructure” (Blueprint).