Lucio is an AI-powered legaltech company that recently signed contracts with in-house teams and top firms including Cyril Amarchand Mangaldas and Trilegal. In this interview, co-founder Vasu Aggarwal delves into the unique challenges of adapting AI for Indian lawyers, addressing concerns about accuracy and data privacy, as well as growth opportunities for companies like his in India. 

ALB: The Indian legal system has unique characteristics like multilingual requirements, non-digitisation of court and other records, and heavy reliance on unwritten procedural rules and oral communication. How do you adapt AI solutions to address the specific needs of Indian lawyers, and what are the major challenges to overcome?

Vasu Aggarwal: With the depth of these problems, India’s legal system is definitely one of a kind, and AI solutions need to be designed with that in mind. Dealing with multiple languages isn’t just about translation—it’s about making sure the legal meaning of terms stays true to context. Similarly, non-digitised records like handwritten or poorly scanned documents need strong systems to recognise the text underneath and to make them usable. 

It’s also true that AI also needs to handle unwritten rules and local practices. It’s not just a problem for artificial intelligence but also for human intelligence; therefore, it becomes hard to address this problem. Similar to how lawyers adapt to these unwritten rules and local practices, artificial intelligence must also be built from that perspective. 

ALB: Indian lawyers often express concerns about AI hallucinations and accuracy, particularly given the high stakes of legal work. What approaches can one take to build trust and demonstrate the reliability of AI solutions in the Indian context? 

Aggarwal: It becomes important to build systems that hallucinate the least, if at all. And AI makers need to understand the reality of it, instead of brushing it off. That’s partly why we think lawyers making AI for lawyers is immensely valuable.

But it is also a two-way street, where lawyers need to understand that they are in the driver’s seat. They must verify the work done by an AI, as they do for their juniors. As I ask this question often to naysayers – if they can confidently say that 100 percent of the work done by them or their juniors is accurate? I bet no lawyer is willing to promise 100 percent accuracy in their engagement letters today.

It's, therefore, incumbent on AI makers to give lawyers full control over the process and output. AI makers must build trust with lawyers by making systems transparent. AI tools should clearly show how they arrive at their conclusions, with citations for everything, so lawyers can double-check the results, 

Finally, involving lawyers in improving the tool is key. If they can flag mistakes and see those issues get fixed, it builds confidence over time. 

ALB: Data privacy and client confidentiality are critical in legal practice, and Indian firms (and their clients) are particularly cautious about cloud solutions. How can legaltech providers effectively address these concerns while delivering cloud-based AI solutions? 

Aggarwal: It is again incumbent on legal tech providers to prioritise security and transparency to address these concerns. Certifications like SOC 2 and ISO 27001 show that the platform is serious about keeping data safe. Regular third-party audits help reinforce the same. 

Offering options like dedicated cloud infrastructure can also help, especially for firms that are hesitant about cloud solutions. Finally, compliance with applicable laws like the Digital Personal Data Protection Act is essential. 

ALB: What are the key growth opportunities and challenges for legaltech companies in India going into 2025, particularly in terms of product innovation and market penetration? How can they effectively scale while addressing the unique needs of the Indian legal market?

Aggarwal: As more firms look for ways to save time and handle bigger workloads, there’s a real opportunity to innovate. 

Scaling in India, however, comes with its own challenges. Many lawyers are used to traditional ways of working, so getting them to adopt new tools requires patience and education. Cost is another factor—solutions need to be affordable. I also see a big shift in vision for lawyers – at least at larger law firms, they are starting to look at these solutions as investments, not just costs.