India, Feb. 10 -- The ministry of electronics and information technology (MeitY) is set to drop the requirement that would have mandated large, fixed-size watermarks on AI-generated content, two officials familiar with the matter said, as the government prepares to notify the final amendments to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, this week.

The draft amendments released in October 2025 proposed that intermediaries offering tools to create or modify synthetically generated information must embed prominent labels or identifiers. For visual content, these labels were proposed to cover at least 10% of the surface display area, while for audio content, an audible marker was proposed...