Published Jun 16, 2026 | 9:00 AM ⚊ Updated Jun 16, 2026 | 9:00 AM
If a department relies on AI to process documents or arrive at decisions, citizens must have clarity on the logic behind those decisions.
Synopsis: Kerala’s aggressive push to bring artificial intelligence into governance has sparked a wider debate over transparency, accountability and the growing use of citizen data in decision-making. The controversy has deepened with the draft State Data Policy – 2026 proposing monetisation of select government-held datasets, triggering fears over privacy, surveillance and the possible misuse of anonymised public information.
As Kerala’s new UDF government aggressively pushes artificial intelligence into governance, a parallel debate is gathering storm over who controls citizen data — and at what cost to privacy.
The controversy surrounding the draft Kerala State Data Policy – 2026 has intensified amid plans to use AI-driven data analysis in public administration, raising fears about whether the state is moving faster on data extraction than on data protection.
In a state still shadowed by the Sprinklr data-sharing row and recent allegations linked to SPARK payroll information, the renewed push for data-driven governance is reopening old anxieties about how securely governments handle citizens’ most sensitive information.
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The state government’s plans to integrate AI into governance have opened up a wider debate on transparency, accountability and data privacy, even as the administration insists the technology will be used to make public services more efficient and responsive.
Chief Minister VD Satheesan hinted at the government’s larger AI ambitions while responding to allegations raised by the Opposition regarding the recently released white paper on the state’s financial condition.
Rejecting claims that AI had been used in preparing the controversial document, the chief minister, on 10 June, said studies were already underway to explore how AI technology could be effectively deployed in governance in the future.
Officials in the Department of Electronics and Information Technology (E&ITD) said the government’s recent decision to create a dedicated AI portfolio — the first such initiative by any state government in the country — signals a major policy shift in the way governance is being envisioned.
Senior officials said the administration is seeing AI not merely as a technological experiment but as a tool capable of streamlining public services and strengthening decision-making through data-driven analysis.
“As the Chief Minister mentioned, studies are ongoing on where AI can be used and how it can be implemented effectively. The priority is to ensure frictionless governance,” an E&ITD official said.
Officials believe that AI-powered systems could help departments identify administrative bottlenecks, predict shortages in resources and improve coordination between agencies before problems escalate into crises. Real-time monitoring dashboards, they said, could also make project implementation and public spending more transparent and easier to track.
The scope of AI applications, officials added, may eventually extend beyond public administration into other sectors as well.
However, the government’s AI push has also triggered concerns among policy experts and cybersecurity professionals over the risks associated with “algorithmic governance.”
Critics warned that if AI systems are trained using fragmented or historically biased datasets, they could unintentionally automate discrimination in areas such as welfare distribution, land administration and public resource allocation.
Joseph C Mathew, former IT adviser to former Chief Minister VS Achuthanandan, said the biggest challenge would be ensuring fairness in AI-driven decision-making.
“AI models are only as fair as the data they are trained on. If historical data reflects social or systemic prejudices, the technology may end up reinforcing those inequalities under the appearance of objective machine analysis,” he said.
A cybersecurity expert associated with the Kerala Police’s Cyberdome also raised concerns over transparency and public awareness regarding the handling of sensitive personal information.
“For the average citizen, the idea of a data-driven government naturally raises questions about how personal and financial information is being processed,” said the expert.
“A major concern is transparency. If a government department relies on AI tools to process documents or arrive at decisions, citizens must have clarity on the logic behind those decisions. There are also concerns about how sensitive data is analysed and whether adequate safeguards are in place,” the expert added.
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Parallel to the push towards the use of AI in governance has come the draft Kerala State Data Policy – 2026, a proposed framework that seeks to regulate how government data is generated, shared, stored and even monetised.
Though drafted during the tenure of the previous LDF government by the E&ITD with support from the Kerala State IT Mission, the policy entered the public sphere only in May, coinciding with the change of government in the state.
While the newly elected UDF government is yet to take a final call on the draft, various departments have initiated detailed reviews of the proposed framework and are constituting expert panels to study its implications and submit recommendations.
The latest among them is the Health Department, which, on 3 June, constituted a nine-member committee chaired by the Health Secretary to conduct a detailed evaluation of the draft framework.
The proposed policy seeks to establish a comprehensive framework governing all data generated, collected, stored or processed by departments, offices, agencies and autonomous bodies under the Government of Kerala, including data handled through outsourced agencies using public funds.
The draft stated that the policy would apply to both newly generated digital data and legacy records maintained in electronic as well as physical formats. It covers data generated through the electronic delivery of public services across departments.
However, at the heart of the emerging debate is a provision under the “Pricing” section of the draft policy that allows monetisation of certain categories of government-held datasets.
According to the proposal, datasets classified as “Internal Data” on the State Data Exchange platform can be monetised by government institutions after obtaining approval from the proposed Apex-level Data Governance Committee. The draft said this is intended to offset the substantial investment involved in the collection, storage and maintenance of data.
The policy, however, specified that only anonymised data can be shared or monetised. It clearly stated that personal information of beneficiaries, confidential records and datasets included in the “negative list” cannot be disclosed.
The draft further noted that any pricing mechanism would apply only to private entities, including startups, industries and non-governmental stakeholders, while inter-departmental sharing of internal datasets within the government ecosystem would remain free of cost.
Officials associated with the policy formulation maintain that the framework is aimed at promoting innovation, evidence-based policymaking and better governance by treating data as a shared public resource. The policy also envisions improved collaboration between government departments, research institutions and academia while creating opportunities in the digital economy.
According to the E&ITD, the newly elected government has not yet taken a policy decision on the draft, and the ongoing departmental review process will continue until a final position is arrived at.
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Even as various departments continue consultations on the draft Data Policy, the controversial provision allowing monetisation of certain government-held datasets is triggering growing concern among privacy advocates, technologists and civil society observers. They warned that the proposal could fundamentally alter the relationship between citizens and the state.
The issue carries particular political sensitivity in Kerala, where controversies such as the Sprinklr data-sharing episode during the COVID-19 pandemic and recent allegations surrounding misuse of SPARK payroll data have already deepened public anxieties over the handling of sensitive information by governments and private entities.
Cybersecurity experts said the safeguards proposed in the draft may not be adequate in an era dominated by AI, machine learning and large-scale data aggregation.
An IT expert associated with Cyberdome pointed out that the assumption that anonymised data is inherently safe no longer holds in the age of big data analytics.
“True anonymisation is becoming increasingly difficult to guarantee,” the expert said.
“Individual datasets may appear harmless in isolation — transport patterns, land registration records, local health trends or welfare distribution data. But when multiple datasets are cross-linked using machine learning tools, especially alongside commercially available information or leaked databases, it becomes possible to re-identify individuals or vulnerable communities.”
The expert warned that what appears to be anonymous public data could, through the so-called “Mosaic Effect”, eventually reveal behavioural patterns, geographic vulnerabilities or socio-economic profiling capable of being exploited by corporations or malicious actors.
Another concern flagged by experts is the possibility that monetisation could gradually distort the functioning of government departments themselves.
“Modern privacy frameworks are built around the principle of data minimisation — collect only what is necessary,” the expert noted.
“But once departments are allowed to generate revenue from datasets, there is a risk of institutional incentives shifting towards data maximisation. The more granular and detailed the data collected from citizens, the higher its commercial value,” the expert warned.
According to critics, such a shift could encourage excessive collection of citizen information far beyond what is required for welfare delivery or administrative purposes.
Experts also cautioned that public trust in digital governance systems could suffer long-term damage if citizens begin to feel that information shared with the government for accessing essential services is eventually being repurposed for commercial use.
“If people start believing that their interactions with public infrastructure are being converted into commercial datasets for private industry, there could be widespread scepticism and reluctance in sharing information with the government,” the expert said.
Joseph C. Mathew strongly criticised the proposal, calling it ethically indefensible.
“How can a government monetise datasets collected from citizens? It is completely unethical,” he said. “Why should governments sell data at all? If data is collected for the delivery of a particular public service, it should not be used for any other purpose beyond that,” he pointed out.
He argued that citizens provide personal information to the state under an implicit assurance that it would remain restricted to the purpose for which it was collected.
“When a person gives information for a specific service, there is an obligation on the government that it will not be diverted elsewhere. That is the right of the citizen,” he said. “How does information belonging to ordinary people suddenly become an asset that can be commercially leveraged?”
Mathew also questioned the ideological contradiction in the policy’s origins.
“Surprisingly, a Left government came up with such a proposal,” he said. “But the new UDF government still has the opportunity to correct it and reject the monetisation clause outright.”
(Edited by Majnu Babu).
