Nearly 60% of Indian businesses confident about scaling artificial intelligence responsibly already have mature Responsible AI (RAI) frameworks, but persistent gaps around high-quality data, regulatory clarity and emerging AI risks threaten to slow safe adoption, according to a Nasscom report released on Wednesday.
RAI frameworks guide the ethical, safe and accountable design, development and deployment of AI systems.
The State of Responsible AI in India 2025 survey flagged hallucinations as the most frequently experienced risk, cited by 56% of respondents, followed by privacy violations (36%), lack of explainability (35%), and unintended bias or discrimination (29%).
On implementation barriers, lack of high-quality data tops the list at 43%, while regulatory uncertainty (20%) and shortage of skilled personnel (15%) continue to weigh on organisations.
Regulatory ambiguity is a key concern for large enterprises and startups, whereas small and medium enterprises (SMEs) cite high implementation costs as their second-biggest challenge.
The report was released at Nasscom’s Responsible Intelligence Confluence in New Delhi. It is based on a survey conducted between October and November 2025 of 574 senior executives from large enterprises, SMEs, and startups involved in the commercial development and use of AI in India.
Despite these risks, the survey shows steady progress since 2023. About 30% of Indian businesses have established mature RAI practices, while 45% are actively implementing formal frameworks, indicating a shift from basic awareness to structured strategies and policies.
Nasscom noted a direct correlation between AI maturity and responsible practices, with stronger AI capabilities translating into more robust RAI frameworks.
“Nearly 60% of businesses confident in scaling AI responsibly have mature practices in place,” the report said.
Large enterprises lead RAI maturity at 46%, while SMEs and startups stand at 20% and 16%, respectively. Sector-wise, BFSI is the most mature at 35%, followed by technology, media and telecom at 31%, and healthcare at 18%, with nearly half of firms in these sectors actively strengthening their frameworks.
Workforce readiness is emerging as a priority, with nearly nine in 10 organisations investing in sensitisation and training.
Business leaders expressed the highest confidence in meeting data protection obligations, reflecting relatively mature privacy frameworks, although monitoring-related compliances remain a concern.
Accountability for Responsible AI remains largely top-down, with 48% of organisations placing responsibility with the C-suite or board.
However, 26% now assign it to departmental heads, and AI ethics boards are gaining traction. Among mature organisations, 65% have constituted AI ethics boards or committees, though some companies remain cautious about their effectiveness.
Sangeeta Gupta, senior VP and chief strategy officer at Nasscom, said in a statement that responsible AI has become foundational as AI gets embedded into critical decisions.
“The real measure of India’s AI leadership will not just be in the scale of adoption, but in how responsibly and inclusively these systems are designed and deployed,” she said.
She added that businesses must move beyond compliance-led approaches. “With the right investments in governance, talent, and transparent frameworks, India has the opportunity to set global benchmarks for trustworthy AI that serves society at large.”
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