Nepal Launches Bold AI Policy Initiative

Introduction to Nepal's National AI Policy

Nepal has taken a significant step forward in the realm of artificial intelligence (AI) by approving its National AI Policy, 2025. This policy aims to create a supportive environment for the development, expansion, and safe use of AI across various sectors. It sets up institutional, legal, and regulatory frameworks to ensure ethical, transparent, and inclusive use of AI.

The Cabinet meeting on Monday approved the policy, which was drafted and submitted by the Ministry of Communication and Information Technology. The draft outlines several key objectives, including the development of human resources with the necessary skills to work with AI, as well as promoting innovation, research, and development in the field.

Key Objectives and Focus Areas

The policy emphasizes the protection of citizens' rights, privacy, and security when using AI. It also encourages public-private partnerships in the sector. Experts have welcomed this move, noting that it comes at a time when AI is becoming increasingly integrated into daily life, work, and business.

Chiranjibi Adhikari, senior vice president of the Computer Association of Nepal, highlighted that the policy addresses ethical AI, AI-related fraud and misuse, and its potential impacts on national security. However, he stressed the importance of implementation, suggesting that without active involvement from the private sector, the policy may not achieve its intended impact.

Experts also emphasize the need to promote open AI research and development to create a sustainable impact, given the rapid evolution of technology. Beyond the AI policy, they suggest that removing other legal and ethical hurdles, such as tax-related policies, could help attract foreign investment in the sector.

Current Applications and Future Plans

According to the association, AI in Nepal is most widely used in the financial sector, followed by education and health. Under the policy, the government plans to make laws and standards for a secure and sustainable AI ecosystem. This includes an organizational structure for research, development, regulation, promotion, and use of AI.

Aadesh Khadka, joint secretary of the Information Technology Division at the Ministry of Communication and Information Technology, explained that the policy includes provisions for review every two years due to AI's fast-changing nature. It also envisions introducing new laws, standards, and institutions for AI governance.

Supporting the IT Industry and Skill Development

The policy aims to support the growing Nepali IT industry, enabling companies to provide AI services in the international market. It emphasizes skill development from school to university levels and raises general awareness at the local level. Additionally, it encourages the use of AI in public service delivery, including sectors like agriculture, health, and other services.

Risk management strategies are included in the policy to address threats created by AI tools such as deepfakes. It also focuses on supporting startup businesses with guidelines that help implement innovative ideas to address social and business challenges.

Infrastructure and Data Management

On infrastructure, the policy guides the opening of data centers, leveraging the cold temperatures in Himalayan regions. While the policy does not yet designate a focal point for reporting issues, it is expected that relevant laws will be formulated to address this.

Other strategies include ensuring access to data through secure collection and management for AI development and use. The policy promotes research and development programs, particularly those focused on innovation and entrepreneurship in AI-related goods and services. It also includes provisions for investment promotion and financial facilitation for AI-driven businesses.

Expanding AI Applications

The policy envisions growth in AI applications across IT, health, education, energy, transportation, tourism, and industry. The AI ecosystem will include the development of standards for data, algorithms, transparency, and accountability to ensure safe and effective use.

Standards will also be developed for importing and exporting AI-related goods and for intellectual property protection in AI applications. The policy emphasizes the management of AI-generated information that may be risky, false, or misleading, alongside laws for data protection and confidentiality for individuals and organizations.

Establishing New Institutions

The policy outlines the creation of a National AI Index. For digital infrastructure, it emphasizes expanding high-speed internet using technologies such as 5G and optical fibre to support AI development and use. International-level data centers and cloud infrastructure will be built to facilitate AI initiatives.

The government will establish an AI Regulation Council, chaired by the communications minister and including secretaries from various ministries, to develop standards and regulations. A National AI Centre will also be set up under the communication ministry to manage and facilitate AI development in Nepal.