Nepal’s step towards AI regulation

In today’s time, the omnipresence of AI is undeniable. From virtual assistants like Siri and Alexa to self-driving cars and advanced medical diagnoses, the potential of AI technology is limitless. It has rapidly pervaded various sectors, including finance, communication, education, and government. As AI technologies become more ingrained in everyday life, the need for comprehensive regulation becomes increasingly apparent. Nepal has been without the necessary laws and regulations to govern the AI sector. Recognizing this gap, the government has developed its first-ever concept paper to lay the groundwork for creating essential policies and legal frameworks.

Key points of concept paper

a. General approach of paper on regulating AI 

The concept paper has proposed to formulate a national policy for Artificial Intelligence that ensures cyber security, data protection and upholds user privacy, aligning with international standards and best practices. The paper has also mentioned developing a centralized national portal to expedite the sharing of AI-related information, facilitating communication and collaboration across different sectors. Such effort will help to ensure that all stakeholders have access to the latest information. Another major highlight of the paper is on human capital development. It mentions identifying and enhancing the skills of existing human resources to ensure that a sufficient number of the skilled professionals are available in both public and private sectors for AI development and advancement. This involves assessing the current workforce’s capabilities and implementing targeted training programs to fill any skill gaps in the AI sector. Investing in human capital development enhances the country’s ability to compete globally in the AI sector. A skilled workforce can attract international investments, collaborations, and partnerships, further boosting the nation’s AI ecosystem. With a well-trained workforce, there is a greater potential for innovation and research in AI technologies. This can lead to the development of new AI applications, solutions, and advancements, keeping the nation at the forefront of technological progress.

Similarly, the concept paper emphasizes the need to integrate AI technologies across various sectors, including healthcare, financial services, construction, education, government services, social security, sports, research and development, agriculture, and tourism. The goal of such sectoral application of AI is to enhance the efficiency and effectiveness of these sectors through AI-driven innovations. Different sectors have unique challenges and needs. Tailoring AI applications to each sector allows for solutions that are more relevant and impactful, addressing specific issues effectively. For instance, in healthcare, AI can enhance diagnostic accuracy and personalized treatment, while in financial services, it can improve fraud detection and automate routine tasks. This tailored approach ensures that AI applications are highly relevant and effective in solving sector-specific problems. 

b. Special approach of paper regarding research and development on AI 

The Concept Paper for AI regulation in Nepal outlines a strategic approach to advancing research and development (R&D) in AI technologies. Emphasis is placed on enhancing privacy protection, transparency, and accountability through increased research and investment. Similarly, Specialized AI research centers and laboratories are proposed to be established in universities and industrial settings to drive technological progress in AI. Additionally, the concept of collaboration between academia and industry is also highlighted. Financial support mechanisms, including grants, scholarships, and funding programs, are recommended to encourage collaboration between academia and industry. This mechanism is intended to incentivize both academic researchers and private sector experts to engage in AI development by providing essential resources and support. The paper also mentions developing Common Computing Infrastructure in order to boost AI research and development. This will help to distribute the essential capabilities required for progressive AI research across different institutions and sectors. The major focus is on partnerships with global AI research organizations and universities to promote knowledge exchange and collaborative research, integrating Nepal into the international AI research community.

Expectations onwards

In the Government AI Readiness Index, 2023, Nepal has been ranked 150th out of 193 countries with the total score-30.77. In the Index, the total score is calculated from three bases- government pillar, technology sector pillar, and data and infrastructure pillar. With a total score, 30.77, Nepal has achieved 31.04 in government pillar, 24.21 in technology sector pillar, and 37.06 in data and infrastructure pillar. The three pillars were analyzed by setting different dimensions. Under the government pillar, there were four dimensions- vision, governance and ethic, digital capacity, and adaptability. Similarly, the technology sector pillar comprised three dimensions- maturity, innovation capacity, and human capital. The third pillar, data and infrastructure, has also included three dimensions, infrastructure, data availability and data representativeness. The ranking and scores achieved by Nepal underscores the urgency for the country to establish the vigorous regulatory framework for AI. And the expectation from such regulatory policies and laws is that Nepal will be achieving a higher ranking in the Government AI Readiness Index in coming years. 

Similarly, the laws are expected to be formulated in a manner that align with core democratic principles of the nation and firmly safeguards the fundamental rights such as right to privacy, right to information, right against discrimination, right to freedom of expression etc. that are provided by the Constitution of Nepal. AI technology relies heavily on the collection and analysis of vast amounts of data, often personal and sensitive in nature. The law shall address the issues of these data being misused or improperly accessed leading to the violations of individuals privacy rights. AI systems are only as good as the data they are trained on, and if this data is biased or flawed, the algorithms can perpetuate and even amplify existing prejudices and inequalities. In a country as diverse as Nepal, where ethnicity, language, and religion play significant roles in the social fabric, the risk of biased AI algorithms is especially concerning. Additionally, the right to freedom of expression shall also be the priority of the AI regulatory framework as the AI technologies have the potential to influence and even censor the flow of information. There shall be transparency regarding how these technologies are being used and the data they are collecting. The lack of transparency can undermine people’s right to access information about how their data is being used and processed. Moreover, the introduction of Nepal’s concept paper on AI regulation itself marks a significant step towards the creation of a legal framework and policies regulating AI. It is crucial that these laws are thoughtfully crafted and enforced to ensure that AI technologies positively contribute to the development of the nation by inviting growth and progress in the AI sector while also mitigating the potential risk and harm.