AI-Driven State Surveillance and Digital Privacy in India: A Critical Analysis of the Telecommunications Act, 2023

Abstract

The integration of Artificial Intelligence (AI) into state functions has revolutionized surveillance practices. However this is a cause of raising fundamental questions about digital privacy and constitutional rights. In India, the new Telecommunications Act, 2023^[1]  replaces the colonial-era Indian Telegraph Act, 1885, expanding the government’s regulatory and surveillance powers in the digital domain. It is supposed to update the rules for today’s digital world, but it also gives the government a lot more control over things like online communication and surveillance. Though framed as a modernization of outdated law, the new Act empowers the executive with wide discretionary authority, raising concerns about administrative law principles such as non-arbitrariness, accountability, and checks on delegated legislation. Many people are worried that it gives too much power to officials without enough rules to keep things fair, transparent, or properly checked.^[2]

This research paper aims to critically analyse the Telecommunications Act, 2023, particularly the Right to Privacy as recognized in the landmark case of Justice K.S. Puttaswamy (Retd) v. Union of India. This paper will focus on the implications of AI-driven state surveillance for constitutional rights guaranteed under Articles 19 and 21. It will also examine whether the Act aligns with the doctrine of proportionality and the separation of powers, or whether it risks excessive executive control with limited judicial oversight.

Further, By comparing the Act with global regulations, this paper will explore how difficult it can be to balance national security needs with the protection of digital rights in a democratic country governed by the constitution. Finally, the paper aims to situate the 2023 Act within the broader framework of constitutional and administrative law, evaluating whether it represents progress toward a rights-based digital governance model or a continuation of colonial-style state dominance in a technological age.

Keywords

Telecommunications Act, 2023, AI-driven Surveillance, Digital Privacy,  Administrative Law, Constitutional Rights (Articles 19 & 21), Indian Telegraph Act, 1885.

Introduction

The Telecommunications Act, 2023, aims to consolidate and amend the law relating to telecommunications, addressing issues such as the assignment of spectrum, the authorization of telecommunication networks, and the regulation of various telecommunications services. It also incorporates provisions for digital inclusion, national security, and the establishment of regulatory sandboxes for innovation.

The Telecommunications Act of 2023 replaces the Indian Telegraph Act, 1885 and the Indian Wireless Telegraphy Act, 1933. These two acts previously governed telecommunications in India. The new act aims to modernize and streamline the legal framework for the telecommunications sector, reflecting advancements in technology and the evolving needs of the industry.

The Indian Telegraph Act, 1885^[3], which was one of the primary acts being replaced, covered a wide range of topics related to telegraphs and telephones, including the licensing of operators, the establishment of telegraph lines, and the regulation of telegraph services. The Indian Wireless Telegraphy Act, 1933^[4], focused on the regulation of wireless telegraphy, which includes radio communication.

The Key Provisions of the Telecommunications Act, 2023 are^[5]:

1. Regulation of OTT Services: The bill proposes to bring over-the-top (OTT) services under the definition of telecommunications. This would subject them to similar regulations as traditional telecom services, potentially raising concerns about privacy and freedom of expression.
2. Government powers: The bill grants the government wide-ranging powers, including the ability to:
   1. Suspend or prohibit the use of telecom equipment from countries or individuals for national security reasons.
   2. Take over, manage, or suspend any or all telecommunication services or networks in the interest of national security.
   3. Waive entry fees, license fees, penalties, etc., to promote consumer interests, market competition, or national security.
3. Spectrum allocation: The bill introduces a new system for allocating spectrum for satellite broadband services. This could potentially benefit rural areas and bridge the digital divide.
4. Other provisions: The bill also includes provisions for:
   1. Promoting research and development in the telecom sector
   2. Protecting consumer rights and ensuring data privacy
   3. Facilitating the deployment of new technologies like 5G

Research methodology

This paper adopts a descriptive and analytical research methodology, relying primarily on secondary sources to critically examine AI-driven state surveillance and digital privacy concerns under the Telecommunications Act, 2023. The study draws upon secondary materials such as scholarly articles, newspapers, journals, judicial pronouncements, and credible online resources to provide a comprehensive understanding of the Act’s constitutional and administrative implications.

Review of literature

Data privacy is a very tricky topic to navigate through for both the executive and the law-making body. If not done in an empathetic manner, it can often feel like an invasion of privacy. The relationship between state surveillance and individual privacy has long been debated across legal, philosophical and sociological domains.

Bentham’s Panopticon explains this dilemma in a very simple manner. If we put the surveillance done by the authorities in this model, we can say our digital footprint is a prison. Bentham’s Panopticon is a prison design concept developed by Jeremy Bentham in the 18th century, emphasizing constant surveillance to enforce discipline and control. The core idea is a circular building with cells arranged around a central observation tower. The guards in the tower can see into the cells, but the prisoners cannot see the guards, creating the perception of constant surveillance. This induces self-discipline and conformity in the prisoners, as they are always aware they could be watched, even if they are not.^[6]

Michel Foucault, in Discipline and Punish (1975), expanded this concept to describe the modern state’s use of surveillance as a mechanism of discipline, normalization, and social control. David Lyon, in his works on surveillance studies, identifies modern surveillance as “social sorting,” where data is used to categorize, predict, and control populations. Similarly, Shoshana Zuboff’s Surveillance Capitalism (2019) highlights how data extraction by corporations has blurred the line between state and private surveillance, often with mutual reinforcement. This is particularly relevant in India where private telecom and internet companies are closely regulated by the state and compelled to cooperate in lawful interception, creating an intertwined ecosystem of corporate and governmental surveillance.

This creates a paradox in an individual’s mind. They feel caged and unable to express themselves as they want socially or online in fear of being judged or monitored by an authority. In the digital age, scholars have revisited Bentham and Foucault to argue that technology has enabled a “digital panopticon”, where individuals live under constant visibility through CCTV networks, data trails, biometric systems, and algorithmic monitoring.

This further makes them question if they are truly enjoying their freedom granted to them by the Indian Constitution. Indian citizens enjoy the right to privacy under Article 21 and the right to freedom under Article 19. Constant surveillance of their digital life can violate these rights.

The Telecommunications Act, 2023 replaced the two major colonial era acts which oversaw the digital wellbeing of Indian citizens. On 20 December 2023, the Telecommunications bill, 2023 was passed in Lok Sabha ^[7]and On 21 December 2023, it was passed in Rajya Sabha^[8]. The Bill replaces the Indian Telegraph Act of 1885 with a comprehensive framework for the telecom sector.

It was backed by a landmark case of Justice K.S. Puttaswamy (Retd.) v. Union of India (2017), The Right to Privacy Case. In this case, a nine-judge bench of the Supreme Court unanimously declared privacy as a fundamental right under Article 21 (Right to Life and Personal Liberty) and intrinsic to the freedoms guaranteed under Article 19.

For this paper on the Telecommunications Act, 2023, the Puttaswamy case is extremely crucial. It sets a constitutional standard, stating that any AI-based government surveillance must be legal, necessary, and proportionate, otherwise it goes against the right to privacy under Article 21. For AI-driven surveillance mechanisms, Puttaswamy remains a critical reference point because it requires that technological advancements align with constitutional safeguards, not undermine them.

Method

Introduction: Asking the Fundamental Questions

When examining any new piece of legislation, it is essential to ask the most basic yet profound questions:

• What is it?
•  Why was it introduced?
• Where does it apply?
• How does it work?
• When did it come into force?

These questions act as the pillars for any legal analysis, allowing us to grasp both the text and the spirit of the law. The Telecommunications Act, 2023 is India’s latest and most comprehensive legislative effort to regulate its fast-changing digital communications sector. It aims to bring clarity and control to both the Executive and Judiciary. Unlike its predecessor, the Indian Telegraph Act, 1885, which was designed in an era of wires and telegrams, this Act addresses the realities of encrypted messages, mobile broadband, artificial intelligence driven services, and even national security concerns related to cyber communication.^[9]

This Act governs the digital lives of Indian citizens while simultaneously laying down procedures for the authorities to regulate, monitor, and where necessary, intercept communications. It is not only a regulatory framework but also a strategic instrument of governance in the digital age.

Why the Act Was Introduced: From Telegraph to 5G

The Indian Telegraph Act, 1885 was a foundational statute at the time of its enactment. However, with the explosive growth of mobile phones, internet-based applications, cloud storage, encrypted services and satellite technologies, the Telegraph Act became outdated and obsolete. The inability of the old framework to adequately address issues like cybersecurity, encrypted data, over-the-top (OTT) services and spectrum allocation for modern technologies like 5G created a regulatory vacuum.^[10]

The Telecommunications Act, 2023, therefore, was introduced with three primary objectives:

1. Modernization: To replace outdated frameworks with a contemporary law suited for today’s digital infrastructure.
2. Consolidation: To unify multiple legislations, including the Telegraph Act of 1885, the Indian Wireless Telegraphy Act of 1933, and the Telegraph Wires (Unlawful Possession) Act of 1950, into one comprehensive statute.
3. Balance of Interests: To balance innovation, consumer protection, and national security within one framework.

Thus, the new law reflects India’s ambition to keep pace with technological advancements while safeguarding its sovereignty, citizens’ rights and market competition.

Scope and Applicability of the Act

The Telecommunications Act, 2023 has an extensive scope. It not only governs traditional telecom services like voice calls and SMS but also extends its jurisdiction to internet-based messaging services such as WhatsApp, Telegram, and Signal. Encrypted messages, too, fall within its ambit, though the treatment of OTT platforms remains somewhat ambiguous.

Geographically, the Act extends across the entire territory of India. Interestingly, it also applies extraterritorially to offenses committed outside India if they involve telecommunication services that affect the Indian jurisdiction. This ensures that cybercrimes originating abroad but targeting Indian citizens or networks can be brought under Indian law.

Key Provisions and Mechanisms of the act^[11]

1. Right of Way (RoW) Framework

The Act simplifies and streamlines the process for obtaining Right of Way for telecom infrastructure. Earlier, operators faced lengthy bureaucratic hurdles when laying cables or establishing towers. Now:

1. Public entities (including government agencies, local bodies, and PPP projects like airports, ports, and highways) are obligated to grant RoW except in exceptional circumstances.
2. Provision has been made for the Central Government to establish common ducts and cable corridors to reduce duplication and cost in infrastructure development. This is aligned with the PM Gati Shakti initiative.
   
3. Spectrum Management

Spectrum, the invisible backbone of all wireless communication, will continue to be allocated primarily through auctions. However, the Act provides for exceptions allowing administrative allocation in specific cases, such as for defense or national security. This ensures both revenue generation and strategic use.

3. National Security and Emergency Powers

One of the most debated aspects of the Act is Section 20(2), which empowers the government to suspend or intercept communication during a public emergency or in the interest of public safety. It also allows the government to stop the transmission of any message. The Centre or states may even take temporary possession of a telecom network in such circumstances. While such powers are justified on grounds of security, critics argue that they create a potential risk of government overreach and surveillance abuse.

4. Digital Bharat Nidhi

The earlier Universal Service Obligation Fund (USOF) has now been restructured into the Digital Bharat Nidhi. Unlike the USOF, which was primarily meant to fund rural connectivity, the new fund can be used more broadly for research, development, and pilot projects in telecommunications. This reflects a forward-looking vision to foster innovation and indigenous technology.

5. Regulatory Sandbox

The Act provides a legal framework for establishing Regulatory Sandboxes, where telecom operators and startups can experiment with emerging technologies under a controlled environment. This is particularly useful for 5G, satellite communication, and AI-driven services, ensuring innovation while minimizing risks.

6. User Protection Mechanisms

User rights have been given explicit attention. The Act mandates:

1. Establishment of mandatory Do Not Disturb (DND) registers to curb spam calls and messages.
2. Prohibition of commercial messages without user consent, with penalties on violators.
3. Limits on SIM ownership: more than 9 SIM cards will attract fines up to ₹2 lakh, while in sensitive regions like Jammu & Kashmir and the Northeast, the limit is capped at 6 SIMs.

These provisions directly address consumer grievances and ensure responsible usage of telecom resources.

7. Dispute Resolution

A multi-tiered system has been established:

1. An independent adjudicatory body will handle disputes at the primary level.
2. Appeals can then be escalated to the Telecom Disputes Settlement and Appellate Tribunal (TDSAT).

This ensures transparency, specialization, and quicker resolution of sector-specific disputes.

Regulatory and Institutional Framework

While the Telecom Regulatory Authority of India (TRAI) continues to play a key role in tariff and service regulation, the licensing authority remains vested with the central government. This dual structure reflects a blend of regulatory independence and central oversight.

The Act also places emphasis on standard-setting, empowering the Central Government to notify technical standards and conformity assessment measures for telecom equipment. This is critical in an era of global cybersecurity threats and supply chain vulnerabilities.

The Act extends to the whole of India and can apply to offenses committed outside India by any person under the Act.

Historical Context: 1885 to 2023^[12]

The journey from the Telegraph Act to the Telecommunications Act demonstrates India’s legal adaptability.

• The Indian Telegraph Act, 1885: Focused on wired telegraphs and state monopoly.
• The Indian Wireless Telegraphy Act, 1933: Addressed wireless telegraphy and spectrum regulation.
• The Telegraph Wires (Unlawful Possession) Act, 1950: Dealt with unlawful possession of telegraph wires (repealed in 2023).
• The TRAI Act, 1997: Established TRAI and TDSAT (Telecom Disputes Settlement and Appellate Tribunal) for tariff regulation and dispute resolution.
  

By replacing these outdated laws with a consolidated framework, the 2023 Act represents both continuity and change in India’s telecom policy.

Concerns and Criticisms^[13]

1. Broad Government Powers: While national security is a legitimate concern, provisions for interception and suspension of communication raise fears of mass surveillance and erosion of the right to privacy.
2. OTT Ambiguity: Although OTT platforms are not explicitly named, the broad definition of “telecommunication services” suggests possible future regulation, raising uncertainty for tech companies.
3. Innovation vs. Regulation: The challenge lies in ensuring strict regulations don’t hold back innovation, especially for startups developing cutting-edge and disruptive technologies.
4. Cybersecurity: While the Act mentions cybersecurity safeguards, it lacks a robust, detailed framework for data protection, especially in the absence of comprehensive personal data protection laws.
   
   

Balancing Growth and Governance

The Telecommunications Act, 2023 is more than a regulatory statute. It is a strategic blueprint for India’s digital future. By modernizing outdated frameworks, consolidating laws, and introducing new mechanisms like the Digital Bharat Nidhi and regulatory sandboxes, the Act promises to foster innovation and growth. At the same time, the emphasis on user protection and infrastructure development highlights its developmental focus.

However, the Act’s broad governmental powers, particularly in areas of interception, surveillance, and emergency control, must be exercised with utmost caution. The real test of this law will lie not just in its text but in its implementation, where transparency, accountability and stakeholder participation will determine whether it genuinely balances security, innovation, and individual rights.

Conclusions and suggestions

We analyzed that the Telecommunications Act, 2023 was a much-needed change in the Indian digital well-being and regulation. Even though the further acts covered the majority of the basis with new developments, new rules were needed. The new act covers all that and more. This, though, brings doubt into the citizens’ minds about what extent to which their digital footprint is being monitored. They sometimes get paranoid and suffer from mental stress because of this. But as history has always seen, a new act needs a few amendments and time to be right for the citizens. It will evolve further with feedback from citizens and the judiciary, and then become legitimate and well accepted by the citizens.

In this manner, the worry of the citizens about giving absolute power to the state and minimizing judicial oversight is not a serious concern. As per my analysis, with time and patience, and a few amendments or guidelines for the state to follow, this act will find genuine balance.

As for the matter of AI, if the state uses AI for surveillance and regulatory work, it can very well jeopardize the information of its citizens and create social unrest. So I believe the state should minimize the use of AI and instead hire professionals to do this work.

In conclusion, the act was very much needed as laws too need to evolve with the revolution in technology and society. And as far as AI is concerned, if certain rules and regulations are put forward and penalties established for not only the citizens but also the authorities, then the development and deployment of AI technologies can be guided in a way that prioritizes ethical standards, public safety, and accountability. This ensures that both individuals and institutions are held responsible for misuse or negligence, fostering trust and transparency in how AI is integrated into society.

Footnotes 

[1] Gazette of India, The Telecommunications Act, 2023, No. 44, Acts of Parliament, 2023, https://egazette.gov.in/WriteReadData/2023/250880.pdf.

[2] National Informatics Centre, Digital Sansad, https://sansad.in  (last visited Aug. 17, 2025).
[3] The Indian Telegraph Act, No. 13 of 1885, INDIA CODE (1885), https://www.indiacode.nic.in/handle/123456789/1843.

[4] The Indian Wireless Telegraphy Act, No. 17 of 1933, INDIA CODE (1933), https://www.indiacode.nic.in/handle/123456789/2237.

[5] Trilegal, The Telecommunications Act, 2023: A Step Towards Digital India, https://trilegal.com/knowledge_repository/the-telecommunications-act-2023-a-step-towards-digital-india (last visited Aug. 17, 2025).

[6] UCL Bentham Project, Jeremy Bentham: The Panopticon, https://www.ucl.ac.uk/bentham-project/about-jeremy-bentham/panopticon (last visited Aug. 17, 2025).

[7]Telecommunications Bill 2023 Tabled in Lok Sabha, The Economic Times (Dec. 18, 2023), https://economictimes.indiatimes.com/news/india/telecommunications-bill-2023-tabled-in-lok-sabha.

[8]Telecom Bill 2023: What Powers It Gives the Government for ‘National Security’, The Economic Times (Dec. 18, 2023), https://economictimes.indiatimes.com/news/india/telecom-bill-2023-what-powers-it-gives-government.

[9]Telecom Bill Allows Centre to Take Over, Suspend Services Over ‘National Security’, India Today (Dec. 18, 2023), https://www.indiatoday.in/india/story/telecom-bill-centre-suspend-services-national-security-2023-18.

[10] India Code, The Telecommunications Act, 2023, https://www.indiacode.nic.in/bitstream/123456789/20101/1/A2023-44.pdf.

[11] Drishti IAS, Telecommunications Act, 2023, Daily News Analysis, https://www.drishtiias.com/daily-updates/daily-news-analysis/telecommunications-act-2023-1 (last visited Aug. 17, 2025).

[12] Parliament Winter Session: Ashwini Vaishnaw Introduces Telecommunications Bill, 2023 in Lok Sabha, Business Today (Dec. 18, 2023), https://www.businesstoday.in/latest/policy/story/telecommunications-bill-2023-introduced-in-parliament.

[13] Karan Mahadik, Parliament Winter Session: New Telecom Bill Introduced in Lok Sabha Amid Ruckus, The Quint (Dec. 18, 2023), https://www.thequint.com/news/politics/telecom-bill-lok-sabha-ruckus.

Tvisha Gupta

University of Mumbai, Thane subcampus