Indian banks ready for AI risks, says Nirmala Sitharaman flags Mythos concerns

Finance Minister Nirmala Sitharaman. File Pic

Finance Minister Nirmala Sitharaman on Friday said that Indian banks are adequately prepared to deal with emerging technology-related challenges, even as she raised fresh concerns over risks linked to a new artificial intelligence model developed by Anthropic.

Speaking to reporters, FM Sitharaman noted that India is closely monitoring the potential threats posed by Anthropic's Mythos AI model, which has drawn global attention for its advanced capabilities.

The finance minister said the Ministry of Electronics and Information Technology (MeitY) is actively engaging with international governments and authorities to better understand the risks associated with the model and assess its possible impact on India's banking ecosystem.

The Finance Minister noted that while Indian banks remain resilient, the rapidly evolving nature of artificial intelligence requires greater vigilance.

FM Sitharaman indicated that existing regulatory and security frameworks may need to be updated to effectively tackle newer and more sophisticated threats emerging from advanced AI systems.

Highlighting the need for coordinated action, FM Sitharaman said banks have been asked to work together on this issue.

Her remarks come a day after she flagged "unprecedented" risks associated with the Mythos AI model.

The Indian Banks' Association will lead consultations among lenders to address concerns and strengthen sector-wide preparedness.

Meanwhile, earlier this month, FM Sitharaman said that India's strong fiscal position and robust foreign exchange reserves provide the Reserve Bank of India with more policy flexibility.

Addressing the golden jubilee celebrations of the National Institute of Public Finance and Policy on April 6, the Finance Minister said, "India has fiscal space with room to maintain the government's capex programme, room for the RBI to cut rates, and room to offer targeted support to affected sectors. This is the dividend of a decade of fiscal discipline that is paying dividends."

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