AI-enabled healthcare presents exciting opportunities for better healthcare outcomes in India. The governance of any emerging technology can take multiple forms; mitigating risks while incentivising applications will require various policy instruments. Understanding public interest and market failures, such as the under-provision of goods with positive externalities like vaccines, helps identify broad governance priorities. Further, analysing AI’s impact on specific tasks across different time horizons clarifies its risks and opportunities. Such an analysis reveals governance opportunities — creating better datasets, building accountability in healthcare systems, and upskilling medical personnel to achieve enhanced healthcare outcomes. As AI develops alongside other technologies in the healthcare space, periodic reviews will be necessary to assess their holistic, rather than individual, impacts. A short-, medium-, and long-term outlook for integrating AI in India is essential to understand its underlying ethical concerns and unintended consequences, and to effectively manage potential risks.