FM flags AI risks, says banks ready for challenges

Finance Minister Nirmala Sitharaman said Indian banks are prepared for tech risks but warned about threats from Anthropic’s Mythos AI, with Ministry of Electronics and Information Technology monitoring impacts and urging stronger safeguards

New Delhi: 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 governments and authorities abroad to better understand the risks associated with the model and assess its potential 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.”