diff --git a/backend/src/ee/services/identity-project-additional-privilege/identity-project-additional-privilege-service.ts b/backend/src/ee/services/identity-project-additional-privilege/identity-project-additional-privilege-service.ts
index 4811eb52a..127de1383 100644
--- a/backend/src/ee/services/identity-project-additional-privilege/identity-project-additional-privilege-service.ts
+++ b/backend/src/ee/services/identity-project-additional-privilege/identity-project-additional-privilege-service.ts
@@ -1,4 +1,4 @@
-import { ForbiddenError, MongoAbility, RawRuleOf } from "@casl/ability";
+import { ForbiddenError, MongoAbility, RawRuleOf, subject } from "@casl/ability";
 import { PackRule, packRules, unpackRules } from "@casl/ability/extra";
 import ms from "ms";
 
@@ -69,7 +69,11 @@ export const identityProjectAdditionalPrivilegeServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Edit, ProjectPermissionSub.Identity);
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Edit,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
+
     const { permission: targetIdentityPermission } = await permissionService.getProjectPermission(
       ActorType.IDENTITY,
       identityId,
@@ -146,7 +150,11 @@ export const identityProjectAdditionalPrivilegeServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Edit, ProjectPermissionSub.Identity);
+
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Edit,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
 
     const { permission: targetIdentityPermission } = await permissionService.getProjectPermission(
       ActorType.IDENTITY,
@@ -241,7 +249,11 @@ export const identityProjectAdditionalPrivilegeServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Edit, ProjectPermissionSub.Identity);
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Edit,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
+
     const { permission: identityRolePermission } = await permissionService.getProjectPermission(
       ActorType.IDENTITY,
       identityProjectMembership.identityId,
@@ -294,7 +306,10 @@ export const identityProjectAdditionalPrivilegeServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Read, ProjectPermissionSub.Identity);
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Read,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
 
     const identityPrivilege = await identityProjectAdditionalPrivilegeDAL.findOne({
       slug,
@@ -333,7 +348,11 @@ export const identityProjectAdditionalPrivilegeServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Edit, ProjectPermissionSub.Identity);
+
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Read,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
 
     const identityPrivileges = await identityProjectAdditionalPrivilegeDAL.find({
       projectMembershipId: identityProjectMembership.id
diff --git a/backend/src/ee/services/permission/project-permission.ts b/backend/src/ee/services/permission/project-permission.ts
index c6e574fb1..f6d7f715f 100644
--- a/backend/src/ee/services/permission/project-permission.ts
+++ b/backend/src/ee/services/permission/project-permission.ts
@@ -82,6 +82,10 @@ export type SecretImportSubjectFields = {
   secretPath: string;
 };
 
+export type IdentityManagementSubjectFields = {
+  identityId: string;
+};
+
 export type ProjectPermissionSet =
   | [
       ProjectPermissionActions,
@@ -121,7 +125,10 @@ export type ProjectPermissionSet =
   | [ProjectPermissionActions, ProjectPermissionSub.ServiceTokens]
   | [ProjectPermissionActions, ProjectPermissionSub.SecretApproval]
   | [ProjectPermissionActions, ProjectPermissionSub.SecretRotation]
-  | [ProjectPermissionActions, ProjectPermissionSub.Identity]
+  | [
+      ProjectPermissionActions,
+      ProjectPermissionSub.Identity | (ForcedSubject<ProjectPermissionSub.Identity> & IdentityManagementSubjectFields)
+    ]
   | [ProjectPermissionActions, ProjectPermissionSub.CertificateAuthorities]
   | [ProjectPermissionActions, ProjectPermissionSub.Certificates]
   | [ProjectPermissionActions, ProjectPermissionSub.CertificateTemplates]
@@ -213,6 +220,21 @@ const SecretConditionV2Schema = z
   })
   .partial();
 
+const IdentityManagementConditionSchema = z
+  .object({
+    identityId: z.union([
+      z.string(),
+      z
+        .object({
+          [PermissionConditionOperators.$EQ]: PermissionConditionSchema[PermissionConditionOperators.$EQ],
+          [PermissionConditionOperators.$NEQ]: PermissionConditionSchema[PermissionConditionOperators.$NEQ],
+          [PermissionConditionOperators.$IN]: PermissionConditionSchema[PermissionConditionOperators.$IN]
+        })
+        .partial()
+    ])
+  })
+  .partial();
+
 const GeneralPermissionSchema = [
   z.object({
     subject: z.literal(ProjectPermissionSub.SecretApproval).describe("The entity this permission pertains to."),
@@ -262,12 +284,6 @@ const GeneralPermissionSchema = [
       "Describe what action an entity can take."
     )
   }),
-  z.object({
-    subject: z.literal(ProjectPermissionSub.Identity).describe("The entity this permission pertains to."),
-    action: CASL_ACTION_SCHEMA_NATIVE_ENUM(ProjectPermissionActions).describe(
-      "Describe what action an entity can take."
-    )
-  }),
   z.object({
     subject: z.literal(ProjectPermissionSub.ServiceTokens).describe("The entity this permission pertains to."),
     action: CASL_ACTION_SCHEMA_NATIVE_ENUM(ProjectPermissionActions).describe(
@@ -373,6 +389,12 @@ export const ProjectPermissionV1Schema = z.discriminatedUnion("subject", [
       "Describe what action an entity can take."
     )
   }),
+  z.object({
+    subject: z.literal(ProjectPermissionSub.Identity).describe("The entity this permission pertains to."),
+    action: CASL_ACTION_SCHEMA_NATIVE_ENUM(ProjectPermissionActions).describe(
+      "Describe what action an entity can take."
+    )
+  }),
   ...GeneralPermissionSchema
 ]);
 
@@ -417,6 +439,16 @@ export const ProjectPermissionV2Schema = z.discriminatedUnion("subject", [
       "When specified, only matching conditions will be allowed to access given resource."
     ).optional()
   }),
+  z.object({
+    subject: z.literal(ProjectPermissionSub.Identity).describe("The entity this permission pertains to."),
+    inverted: z.boolean().optional().describe("Whether rule allows or forbids."),
+    action: CASL_ACTION_SCHEMA_NATIVE_ENUM(ProjectPermissionActions).describe(
+      "Describe what action an entity can take."
+    ),
+    conditions: IdentityManagementConditionSchema.describe(
+      "When specified, only matching conditions will be allowed to access given resource."
+    ).optional()
+  }),
   ...GeneralPermissionSchema
 ]);
 
@@ -697,26 +729,26 @@ export const buildServiceTokenProjectPermission = (
     [ProjectPermissionSub.Secrets, ProjectPermissionSub.SecretImports, ProjectPermissionSub.SecretFolders].forEach(
       (subject) => {
         if (canWrite) {
-          // TODO: @Akhi
-          // @ts-expect-error type
           can(ProjectPermissionActions.Edit, subject, {
+            // TODO: @Akhi
+            // @ts-expect-error type
             secretPath: { $glob: secretPath },
             environment
           });
-          // @ts-expect-error type
           can(ProjectPermissionActions.Create, subject, {
+            // @ts-expect-error type
             secretPath: { $glob: secretPath },
             environment
           });
-          // @ts-expect-error type
           can(ProjectPermissionActions.Delete, subject, {
+            // @ts-expect-error type
             secretPath: { $glob: secretPath },
             environment
           });
         }
         if (canRead) {
-          // @ts-expect-error type
           can(ProjectPermissionActions.Read, subject, {
+            // @ts-expect-error type
             secretPath: { $glob: secretPath },
             environment
           });
diff --git a/backend/src/services/identity-project/identity-project-service.ts b/backend/src/services/identity-project/identity-project-service.ts
index 7f9cf920e..69364a3cf 100644
--- a/backend/src/services/identity-project/identity-project-service.ts
+++ b/backend/src/services/identity-project/identity-project-service.ts
@@ -1,4 +1,4 @@
-import { ForbiddenError } from "@casl/ability";
+import { ForbiddenError, subject } from "@casl/ability";
 import ms from "ms";
 
 import { ProjectMembershipRole } from "@app/db/schemas";
@@ -161,7 +161,10 @@ export const identityProjectServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Edit, ProjectPermissionSub.Identity);
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Edit,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
 
     const projectIdentity = await identityProjectDAL.findOne({ identityId, projectId });
     if (!projectIdentity)
@@ -253,7 +256,11 @@ export const identityProjectServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Delete, ProjectPermissionSub.Identity);
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Delete,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
+
     const { permission: identityRolePermission } = await permissionService.getProjectPermission(
       ActorType.IDENTITY,
       identityId,
@@ -317,7 +324,11 @@ export const identityProjectServiceFactory = ({
       actorAuthMethod,
       actorOrgId
     );
-    ForbiddenError.from(permission).throwUnlessCan(ProjectPermissionActions.Read, ProjectPermissionSub.Identity);
+
+    ForbiddenError.from(permission).throwUnlessCan(
+      ProjectPermissionActions.Read,
+      subject(ProjectPermissionSub.Identity, { identityId })
+    );
 
     const [identityMembership] = await identityProjectDAL.findByProjectId(projectId, { identityId });
     if (!identityMembership)
diff --git a/frontend/package-lock.json b/frontend/package-lock.json
index 91b8d4bc3..64380ae9f 100644
--- a/frontend/package-lock.json
+++ b/frontend/package-lock.json
@@ -89,7 +89,7 @@
         "react-mailchimp-subscribe": "^2.1.3",
         "react-markdown": "^8.0.3",
         "react-redux": "^8.0.2",
-        "react-select": "^5.8.3",
+        "react-select": "^5.8.1",
         "react-table": "^7.8.0",
         "react-toastify": "^9.1.3",
         "sanitize-html": "^2.12.1",
diff --git a/frontend/src/context/ProjectPermissionContext/types.ts b/frontend/src/context/ProjectPermissionContext/types.ts
index 8f10d5f21..673b2b41a 100644
--- a/frontend/src/context/ProjectPermissionContext/types.ts
+++ b/frontend/src/context/ProjectPermissionContext/types.ts
@@ -33,6 +33,10 @@ export enum PermissionConditionOperators {
   $GLOB = "$glob"
 }
 
+export type IdentityManagementSubjectFields = {
+  identityId: string;
+};
+
 export const formatedConditionsOperatorNames: { [K in PermissionConditionOperators]: string } = {
   [PermissionConditionOperators.$EQ]: "equal to",
   [PermissionConditionOperators.$IN]: "contains",
@@ -151,7 +155,13 @@ export type ProjectPermissionSet =
   | [ProjectPermissionActions, ProjectPermissionSub.ServiceTokens]
   | [ProjectPermissionActions, ProjectPermissionSub.SecretApproval]
   | [ProjectPermissionActions, ProjectPermissionSub.SecretRotation]
-  | [ProjectPermissionActions, ProjectPermissionSub.Identity]
+  | [
+      ProjectPermissionActions,
+      (
+        | ProjectPermissionSub.Identity
+        | (ForcedSubject<ProjectPermissionSub.Identity> & IdentityManagementSubjectFields)
+      )
+    ]
   | [ProjectPermissionActions, ProjectPermissionSub.CertificateAuthorities]
   | [ProjectPermissionActions, ProjectPermissionSub.Certificates]
   | [ProjectPermissionActions, ProjectPermissionSub.CertificateTemplates]
diff --git a/frontend/src/reactQuery.tsx b/frontend/src/reactQuery.tsx
index c897c6e02..1b6e69b36 100644
--- a/frontend/src/reactQuery.tsx
+++ b/frontend/src/reactQuery.tsx
@@ -92,7 +92,7 @@ export const queryClient = new QueryClient({
                   >
                     <div className="flex flex-col gap-2">
                       {serverResponse.details?.map((el, index) => {
-                        const hasConditions = Object.keys(el.conditions || {}).length;
+                        const hasConditions = Boolean(Object.keys(el.conditions || {}).length);
                         return (
                           <div
                             key={`Forbidden-error-details-${index + 1}`}
diff --git a/frontend/src/views/Project/IdentityDetailsPage/IdentityDetailPage.tsx b/frontend/src/views/Project/IdentityDetailsPage/IdentityDetailPage.tsx
index 95aed14c5..d16bd64ae 100644
--- a/frontend/src/views/Project/IdentityDetailsPage/IdentityDetailPage.tsx
+++ b/frontend/src/views/Project/IdentityDetailsPage/IdentityDetailPage.tsx
@@ -1,4 +1,5 @@
 import { useRouter } from "next/router";
+import { subject } from "@casl/ability";
 import { faChevronLeft } from "@fortawesome/free-solid-svg-icons";
 import { FontAwesomeIcon } from "@fortawesome/react-fontawesome";
 import { format } from "date-fns";
@@ -94,7 +95,9 @@ export const IdentityDetailsPage = withProjectPermission(
                   <div>
                     <ProjectPermissionCan
                       I={ProjectPermissionActions.Delete}
-                      a={ProjectPermissionSub.Identity}
+                      a={subject(ProjectPermissionSub.Identity, {
+                        identityId: identityMembershipDetails?.identity?.id
+                      })}
                       renderTooltip
                       allowedLabel="Remove from project"
                     >
diff --git a/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeModifySection.tsx b/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeModifySection.tsx
index f69cd1478..586a1db7a 100644
--- a/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeModifySection.tsx
+++ b/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeModifySection.tsx
@@ -17,25 +17,24 @@ import { TtlFormLabel } from "@app/components/features";
 import { createNotification } from "@app/components/notifications";
 import {
   Button,
+  DropdownMenu,
+  DropdownMenuContent,
+  DropdownMenuItem,
+  DropdownMenuTrigger,
   FormControl,
   FormLabel,
   Input,
-  Modal,
-  ModalContent,
-  ModalTrigger,
   Popover,
   PopoverContent,
   PopoverTrigger,
   Tag,
-  Tooltip
-} from "@app/components/v2";
+  Tooltip} from "@app/components/v2";
 import {
   ProjectPermissionActions,
   ProjectPermissionSub,
   useProjectPermission,
   useWorkspace
 } from "@app/context";
-import { usePopUp } from "@app/hooks";
 import {
   useCreateIdentityProjectAdditionalPrivilege,
   useGetIdentityProjectPrivilegeDetails,
@@ -43,14 +42,13 @@ import {
 } from "@app/hooks/api";
 import { IdentityProjectAdditionalPrivilegeTemporaryMode } from "@app/hooks/api/identityProjectAdditionalPrivilege/types";
 import { GeneralPermissionPolicies } from "@app/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies";
-import { NewPermissionRule } from "@app/views/Project/RolePage/components/RolePermissionsSection/components/NewPermissionRule";
 import { PermissionEmptyState } from "@app/views/Project/RolePage/components/RolePermissionsSection/PermissionEmptyState";
 import {
   formRolePermission2API,
+  isConditionalSubjects,
   PROJECT_PERMISSION_OBJECT,
   projectRoleFormSchema,
-  rolePermission2Form
-} from "@app/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils";
+  rolePermission2Form} from "@app/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils";
 import { renderConditionalComponents } from "@app/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection";
 
 type Props = {
@@ -88,7 +86,6 @@ export const IdentityProjectAdditionalPrivilegeModifySection = ({
 }: Props) => {
   const isCreate = !privilegeId;
   const { currentWorkspace } = useWorkspace();
-  const { popUp, handlePopUpToggle } = usePopUp(["createPolicy"] as const);
   const projectId = currentWorkspace?.id || "";
   const { data: privilegeDetails, isLoading } = useGetIdentityProjectPrivilegeDetails({
     identityId,
@@ -194,6 +191,30 @@ export const IdentityProjectAdditionalPrivilegeModifySection = ({
     }
   }
 
+  const onNewPolicy = (selectedSubject: ProjectPermissionSub) => {
+    const rootPolicyValue = form.getValues(`permissions.${selectedSubject}`);
+    if (rootPolicyValue && isConditionalSubjects(selectedSubject)) {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [...rootPolicyValue, ...[]],
+        { shouldDirty: true, shouldTouch: true }
+      );
+    } else {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [{}],
+        {
+          shouldDirty: true,
+          shouldTouch: true
+        }
+      );
+    }
+  };
+
   return (
     <form
       onSubmit={handleSubmit(onSubmit)}
@@ -232,24 +253,39 @@ export const IdentityProjectAdditionalPrivilegeModifySection = ({
               >
                 Save
               </Button>
-              <Modal
-                isOpen={popUp.createPolicy.isOpen}
-                onOpenChange={(isOpen) => handlePopUpToggle("createPolicy", isOpen)}
-              >
-                <ModalTrigger asChild>
+              <DropdownMenu>
+                <DropdownMenuTrigger>
                   <Button
+                    isDisabled={isDisabled}
                     className="h-10 rounded-l-none"
                     variant="outline_bg"
                     leftIcon={<FontAwesomeIcon icon={faPlus} />}
-                    isDisabled={isDisabled}
                   >
-                    New Policy
+                    New policy
                   </Button>
-                </ModalTrigger>
-                <ModalContent title="New Policy" subTitle="Policies grant additional permissions.">
-                  <NewPermissionRule onClose={() => handlePopUpToggle("createPolicy")} />
-                </ModalContent>
-              </Modal>
+                </DropdownMenuTrigger>
+                <DropdownMenuContent className="thin-scrollbar max-h-96" align="end">
+                  {Object.keys(PROJECT_PERMISSION_OBJECT)
+                    .sort((a, b) =>
+                      PROJECT_PERMISSION_OBJECT[a as keyof typeof PROJECT_PERMISSION_OBJECT].title
+                        .toLowerCase()
+                        .localeCompare(
+                          PROJECT_PERMISSION_OBJECT[
+                            b as keyof typeof PROJECT_PERMISSION_OBJECT
+                          ].title.toLowerCase()
+                        )
+                    )
+                    .map((subject) => (
+                      <DropdownMenuItem
+                        key={`permission-create-${subject}`}
+                        className="py-3"
+                        onClick={() => onNewPolicy(subject as ProjectPermissionSub)}
+                      >
+                        {PROJECT_PERMISSION_OBJECT[subject as ProjectPermissionSub].title}
+                      </DropdownMenuItem>
+                    ))}
+                </DropdownMenuContent>
+              </DropdownMenu>
             </div>
           </div>
         </div>
diff --git a/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeSection.tsx b/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeSection.tsx
index 975ddb5c7..db900b1b2 100644
--- a/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeSection.tsx
+++ b/frontend/src/views/Project/IdentityDetailsPage/components/IdentityProjectAdditionalPrivilegeSection/IdentityProjectAdditionalPrivilegeSection.tsx
@@ -1,3 +1,4 @@
+import { subject } from "@casl/ability";
 import { faEllipsisV, faFolder, faPlus, faTrash } from "@fortawesome/free-solid-svg-icons";
 import { FontAwesomeIcon } from "@fortawesome/react-fontawesome";
 import { format, formatDistance } from "date-fns";
@@ -83,7 +84,9 @@ export const IdentityProjectAdditionalPrivilegeSection = ({ identityMembershipDe
               privilegeId={(popUp?.modifyPrivilege?.data as { id: string })?.id}
               isDisabled={permission.cannot(
                 ProjectPermissionActions.Edit,
-                ProjectPermissionSub.Identity
+                subject(ProjectPermissionSub.Identity, {
+                  identityId
+                })
               )}
             />
           </motion.div>
@@ -103,7 +106,9 @@ export const IdentityProjectAdditionalPrivilegeSection = ({ identityMembershipDe
 
               <ProjectPermissionCan
                 I={ProjectPermissionActions.Edit}
-                a={ProjectPermissionSub.Identity}
+                a={subject(ProjectPermissionSub.Identity, {
+                  identityId
+                })}
                 renderTooltip
                 allowedLabel="Add Privilege"
               >
@@ -192,7 +197,9 @@ export const IdentityProjectAdditionalPrivilegeSection = ({ identityMembershipDe
                               <div className="flex space-x-2 opacity-0 transition-opacity duration-300 group-hover:opacity-100">
                                 <ProjectPermissionCan
                                   I={ProjectPermissionActions.Edit}
-                                  a={ProjectPermissionSub.Identity}
+                                  a={subject(ProjectPermissionSub.Identity, {
+                                    identityId
+                                  })}
                                   renderTooltip
                                   allowedLabel="Remove Role"
                                 >
diff --git a/frontend/src/views/Project/MemberDetailsPage/components/MemberProjectAdditionalPrivilegeSection/MembershipProjectAdditionalPrivilegeModifySection.tsx b/frontend/src/views/Project/MemberDetailsPage/components/MemberProjectAdditionalPrivilegeSection/MembershipProjectAdditionalPrivilegeModifySection.tsx
index e5a6adf4d..4118429b2 100644
--- a/frontend/src/views/Project/MemberDetailsPage/components/MemberProjectAdditionalPrivilegeSection/MembershipProjectAdditionalPrivilegeModifySection.tsx
+++ b/frontend/src/views/Project/MemberDetailsPage/components/MemberProjectAdditionalPrivilegeSection/MembershipProjectAdditionalPrivilegeModifySection.tsx
@@ -17,12 +17,13 @@ import { TtlFormLabel } from "@app/components/features";
 import { createNotification } from "@app/components/notifications";
 import {
   Button,
+  DropdownMenu,
+  DropdownMenuContent,
+  DropdownMenuItem,
+  DropdownMenuTrigger,
   FormControl,
   FormLabel,
   Input,
-  Modal,
-  ModalContent,
-  ModalTrigger,
   Popover,
   PopoverContent,
   PopoverTrigger,
@@ -35,7 +36,6 @@ import {
   useProjectPermission,
   useWorkspace
 } from "@app/context";
-import { usePopUp } from "@app/hooks";
 import {
   useCreateProjectUserAdditionalPrivilege,
   useGetProjectUserPrivilegeDetails,
@@ -43,14 +43,13 @@ import {
 } from "@app/hooks/api";
 import { ProjectUserAdditionalPrivilegeTemporaryMode } from "@app/hooks/api/projectUserAdditionalPrivilege/types";
 import { GeneralPermissionPolicies } from "@app/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies";
-import { NewPermissionRule } from "@app/views/Project/RolePage/components/RolePermissionsSection/components/NewPermissionRule";
 import { PermissionEmptyState } from "@app/views/Project/RolePage/components/RolePermissionsSection/PermissionEmptyState";
 import {
   formRolePermission2API,
+  isConditionalSubjects,
   PROJECT_PERMISSION_OBJECT,
   projectRoleFormSchema,
-  rolePermission2Form
-} from "@app/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils";
+  rolePermission2Form} from "@app/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils";
 import { renderConditionalComponents } from "@app/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection";
 
 type Props = {
@@ -88,7 +87,6 @@ export const MembershipProjectAdditionalPrivilegeModifySection = ({
 }: Props) => {
   const isCreate = !privilegeId;
   const { currentWorkspace } = useWorkspace();
-  const { popUp, handlePopUpToggle } = usePopUp(["createPolicy"] as const);
   const projectId = currentWorkspace?.id || "";
   const { data: privilegeDetails, isLoading } = useGetProjectUserPrivilegeDetails(
     privilegeId || ""
@@ -167,6 +165,30 @@ export const MembershipProjectAdditionalPrivilegeModifySection = ({
     }
   };
 
+  const onNewPolicy = (selectedSubject: ProjectPermissionSub) => {
+    const rootPolicyValue = form.getValues(`permissions.${selectedSubject}`);
+    if (rootPolicyValue && isConditionalSubjects(selectedSubject)) {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [...rootPolicyValue, ...[]],
+        { shouldDirty: true, shouldTouch: true }
+      );
+    } else {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [{}],
+        {
+          shouldDirty: true,
+          shouldTouch: true
+        }
+      );
+    }
+  };
+
   const privilegeTemporaryAccess = form.watch("temporaryAccess");
   const isTemporary = privilegeTemporaryAccess?.isTemporary;
   const isExpired =
@@ -229,24 +251,39 @@ export const MembershipProjectAdditionalPrivilegeModifySection = ({
               >
                 Save
               </Button>
-              <Modal
-                isOpen={popUp.createPolicy.isOpen}
-                onOpenChange={(isOpen) => handlePopUpToggle("createPolicy", isOpen)}
-              >
-                <ModalTrigger asChild>
+              <DropdownMenu>
+                <DropdownMenuTrigger>
                   <Button
+                    isDisabled={isDisabled}
                     className="h-10 rounded-l-none"
                     variant="outline_bg"
                     leftIcon={<FontAwesomeIcon icon={faPlus} />}
-                    isDisabled={isDisabled}
                   >
-                    New Policy
+                    New policy
                   </Button>
-                </ModalTrigger>
-                <ModalContent title="New Policy" subTitle="Policies grant additional permissions.">
-                  <NewPermissionRule onClose={() => handlePopUpToggle("createPolicy")} />
-                </ModalContent>
-              </Modal>
+                </DropdownMenuTrigger>
+                <DropdownMenuContent className="thin-scrollbar max-h-96" align="end">
+                  {Object.keys(PROJECT_PERMISSION_OBJECT)
+                    .sort((a, b) =>
+                      PROJECT_PERMISSION_OBJECT[a as keyof typeof PROJECT_PERMISSION_OBJECT].title
+                        .toLowerCase()
+                        .localeCompare(
+                          PROJECT_PERMISSION_OBJECT[
+                            b as keyof typeof PROJECT_PERMISSION_OBJECT
+                          ].title.toLowerCase()
+                        )
+                    )
+                    .map((subject) => (
+                      <DropdownMenuItem
+                        key={`permission-create-${subject}`}
+                        className="py-3"
+                        onClick={() => onNewPolicy(subject as ProjectPermissionSub)}
+                      >
+                        {PROJECT_PERMISSION_OBJECT[subject as ProjectPermissionSub].title}
+                      </DropdownMenuItem>
+                    ))}
+                </DropdownMenuContent>
+              </DropdownMenu>
             </div>
           </div>
         </div>
diff --git a/frontend/src/views/Project/MembersPage/components/IdentityTab/IdentityTab.tsx b/frontend/src/views/Project/MembersPage/components/IdentityTab/IdentityTab.tsx
index defd32863..362c15656 100644
--- a/frontend/src/views/Project/MembersPage/components/IdentityTab/IdentityTab.tsx
+++ b/frontend/src/views/Project/MembersPage/components/IdentityTab/IdentityTab.tsx
@@ -1,5 +1,6 @@
 import Link from "next/link";
 import { useRouter } from "next/router";
+import { subject } from "@casl/ability";
 import {
   faArrowDown,
   faArrowUp,
@@ -349,7 +350,9 @@ export const IdentityTab = withProjectPermission(
                         <Td className="flex justify-end space-x-2 opacity-0 duration-300 group-hover:opacity-100">
                           <ProjectPermissionCan
                             I={ProjectPermissionActions.Delete}
-                            a={ProjectPermissionSub.Identity}
+                            a={subject(ProjectPermissionSub.Identity, {
+                              identityId: id
+                            })}
                           >
                             {(isAllowed) => (
                               <IconButton
diff --git a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils.tsx b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils.tsx
index e298281f8..fd168d1d1 100644
--- a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils.tsx
+++ b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/ProjectRoleModifySection.utils.tsx
@@ -105,9 +105,14 @@ export const projectRoleFormSchema = z.object({
       })
         .array()
         .default([]),
+      [ProjectPermissionSub.Identity]: GeneralPolicyActionSchema.extend({
+        inverted: z.boolean().optional(),
+        conditions: ConditionSchema
+      })
+        .array()
+        .default([]),
       [ProjectPermissionSub.Member]: GeneralPolicyActionSchema.array().default([]),
       [ProjectPermissionSub.Groups]: GeneralPolicyActionSchema.array().default([]),
-      [ProjectPermissionSub.Identity]: GeneralPolicyActionSchema.array().default([]),
       [ProjectPermissionSub.Role]: GeneralPolicyActionSchema.array().default([]),
       [ProjectPermissionSub.Integrations]: GeneralPolicyActionSchema.array().default([]),
       [ProjectPermissionSub.Webhooks]: GeneralPolicyActionSchema.array().default([]),
@@ -139,7 +144,8 @@ type TConditionalFields =
   | ProjectPermissionSub.Secrets
   | ProjectPermissionSub.SecretFolders
   | ProjectPermissionSub.SecretImports
-  | ProjectPermissionSub.DynamicSecrets;
+  | ProjectPermissionSub.DynamicSecrets
+  | ProjectPermissionSub.Identity;
 
 export const isConditionalSubjects = (
   subject: ProjectPermissionSub
@@ -147,7 +153,8 @@ export const isConditionalSubjects = (
   subject === (ProjectPermissionSub.Secrets as const) ||
   subject === ProjectPermissionSub.DynamicSecrets ||
   subject === ProjectPermissionSub.SecretImports ||
-  subject === ProjectPermissionSub.SecretFolders;
+  subject === ProjectPermissionSub.SecretFolders ||
+  subject === ProjectPermissionSub.Identity;
 
 const convertCaslConditionToFormOperator = (caslConditions: TPermissionCondition) => {
   const formConditions: z.infer<typeof ConditionSchema> = [];
@@ -483,8 +490,8 @@ export const PROJECT_PERMISSION_OBJECT: TProjectPermissionObject = {
       { label: "Remove members", value: "delete" }
     ]
   },
-  [ProjectPermissionSub.Groups]: {
-    title: "Group Management",
+  [ProjectPermissionSub.Identity]: {
+    title: "Machine Identity Management",
     actions: [
       { label: "Read", value: "read" },
       { label: "Create", value: "create" },
@@ -492,8 +499,8 @@ export const PROJECT_PERMISSION_OBJECT: TProjectPermissionObject = {
       { label: "Remove", value: "delete" }
     ]
   },
-  [ProjectPermissionSub.Identity]: {
-    title: "Machine Identity Management",
+  [ProjectPermissionSub.Groups]: {
+    title: "Group Management",
     actions: [
       { label: "Read", value: "read" },
       { label: "Create", value: "create" },
@@ -527,7 +534,7 @@ export const PROJECT_PERMISSION_OBJECT: TProjectPermissionObject = {
     ]
   },
   [ProjectPermissionSub.Environments]: {
-    title: "Environments",
+    title: "Environment Management",
     actions: [
       { label: "Read", value: "read" },
       { label: "Create", value: "create" },
diff --git a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection.tsx b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection.tsx
index 1e00306be..16397ac24 100644
--- a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection.tsx
+++ b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/RolePermissionsSection.tsx
@@ -5,14 +5,19 @@ import { zodResolver } from "@hookform/resolvers/zod";
 import { twMerge } from "tailwind-merge";
 
 import { createNotification } from "@app/components/notifications";
-import { Alert, Button, Modal, ModalContent, ModalTrigger } from "@app/components/v2";
+import {
+  Button,
+  DropdownMenu,
+  DropdownMenuContent,
+  DropdownMenuItem,
+  DropdownMenuTrigger
+} from "@app/components/v2";
 import { ProjectPermissionSub, useWorkspace } from "@app/context";
-import { usePopUp } from "@app/hooks";
 import { useGetProjectRoleBySlug, useUpdateProjectRole } from "@app/hooks/api";
 
 import { GeneralPermissionConditions } from "./components/GeneralPermissionConditions";
 import { GeneralPermissionPolicies } from "./components/GeneralPermissionPolicies";
-import { NewPermissionRule } from "./components/NewPermissionRule";
+import { IdentityManagementPermissionConditions } from "./components/IdentityManagementPermissionConditions";
 import { SecretPermissionConditions } from "./components/SecretPermissionConditions";
 import { PermissionEmptyState } from "./PermissionEmptyState";
 import {
@@ -37,6 +42,10 @@ export const renderConditionalComponents = (
     return <SecretPermissionConditions isDisabled={isDisabled} />;
 
   if (isConditionalSubjects(subject)) {
+    if (subject === ProjectPermissionSub.Identity) {
+      return <IdentityManagementPermissionConditions isDisabled={isDisabled} />;
+    }
+
     return <GeneralPermissionConditions isDisabled={isDisabled} type={subject} />;
   }
 
@@ -45,7 +54,6 @@ export const renderConditionalComponents = (
 
 export const RolePermissionsSection = ({ roleSlug, isDisabled }: Props) => {
   const { currentWorkspace } = useWorkspace();
-  const { popUp, handlePopUpToggle } = usePopUp(["createPolicy"] as const);
   const projectId = currentWorkspace?.id || "";
   const { data: role, isLoading } = useGetProjectRoleBySlug(
     currentWorkspace?.id ?? "",
@@ -83,6 +91,30 @@ export const RolePermissionsSection = ({ roleSlug, isDisabled }: Props) => {
 
   const isCustomRole = !["admin", "member", "viewer", "no-access"].includes(role?.slug ?? "");
 
+  const onNewPolicy = (selectedSubject: ProjectPermissionSub) => {
+    const rootPolicyValue = form.getValues(`permissions.${selectedSubject}`);
+    if (rootPolicyValue && isConditionalSubjects(selectedSubject)) {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [...rootPolicyValue, ...[]],
+        { shouldDirty: true, shouldTouch: true }
+      );
+    } else {
+      form.setValue(
+        `permissions.${selectedSubject}`,
+        // eslint-disable-next-line @typescript-eslint/ban-ts-comment
+        // @ts-ignore-error akhilmhdh: this is because of ts collision with both
+        [{}],
+        {
+          shouldDirty: true,
+          shouldTouch: true
+        }
+      );
+    }
+  };
+
   return (
     <form
       onSubmit={handleSubmit(onSubmit)}
@@ -116,11 +148,8 @@ export const RolePermissionsSection = ({ roleSlug, isDisabled }: Props) => {
                   >
                     Save
                   </Button>
-                  <Modal
-                    isOpen={popUp.createPolicy.isOpen}
-                    onOpenChange={(isOpen) => handlePopUpToggle("createPolicy", isOpen)}
-                  >
-                    <ModalTrigger asChild disabled={isDisabled}>
+                  <DropdownMenu>
+                    <DropdownMenuTrigger>
                       <Button
                         isDisabled={isDisabled}
                         className="h-10 rounded-l-none"
@@ -129,23 +158,36 @@ export const RolePermissionsSection = ({ roleSlug, isDisabled }: Props) => {
                       >
                         New policy
                       </Button>
-                    </ModalTrigger>
-                    <ModalContent
-                      title="New Policy"
-                      subTitle="Policies grant additional permissions."
-                    >
-                      <NewPermissionRule onClose={() => handlePopUpToggle("createPolicy")} />
-                    </ModalContent>
-                  </Modal>
+                    </DropdownMenuTrigger>
+                    <DropdownMenuContent className="thin-scrollbar max-h-96" align="end">
+                      {Object.keys(PROJECT_PERMISSION_OBJECT)
+                        .sort((a, b) =>
+                          PROJECT_PERMISSION_OBJECT[
+                            a as keyof typeof PROJECT_PERMISSION_OBJECT
+                          ].title
+                            .toLowerCase()
+                            .localeCompare(
+                              PROJECT_PERMISSION_OBJECT[
+                                b as keyof typeof PROJECT_PERMISSION_OBJECT
+                              ].title.toLowerCase()
+                            )
+                        )
+                        .map((subject) => (
+                          <DropdownMenuItem
+                            key={`permission-create-${subject}`}
+                            className="py-3"
+                            onClick={() => onNewPolicy(subject as ProjectPermissionSub)}
+                          >
+                            {PROJECT_PERMISSION_OBJECT[subject as ProjectPermissionSub].title}
+                          </DropdownMenuItem>
+                        ))}
+                    </DropdownMenuContent>
+                  </DropdownMenu>
                 </div>
               </>
             )}
           </div>
         </div>
-        <Alert
-          title="Infisical's permissions are now more granular. You can set separate permissions for folders, dynamic secrets, and imports. No changes required for existing APIs and clients."
-          className="mt-4 border-primary/50 bg-primary/10"
-        />
         <div className="py-4">
           {!isLoading && <PermissionEmptyState />}
           {(Object.keys(PROJECT_PERMISSION_OBJECT) as ProjectPermissionSub[]).map((subject) => (
diff --git a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies.tsx b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies.tsx
index 9d6e699cb..15d819fc8 100644
--- a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies.tsx
+++ b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/GeneralPermissionPolicies.tsx
@@ -157,7 +157,7 @@ export const GeneralPermissionPolicies = <T extends keyof NonNullable<TFormSchem
                     size="xs"
                     className="mt-2"
                     onClick={() => {
-                      items.insert(rootIndex, [
+                      items.insert(rootIndex + 1, [
                         { read: false, edit: false, create: false, delete: false } as any
                       ]);
                     }}
diff --git a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/IdentityManagementPermissionConditions.tsx b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/IdentityManagementPermissionConditions.tsx
new file mode 100644
index 000000000..9409ce46d
--- /dev/null
+++ b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/IdentityManagementPermissionConditions.tsx
@@ -0,0 +1,171 @@
+import { Controller, useFieldArray, useFormContext } from "react-hook-form";
+import { faInfoCircle, faPlus, faTrash, faWarning } from "@fortawesome/free-solid-svg-icons";
+import { FontAwesomeIcon } from "@fortawesome/react-fontawesome";
+
+import {
+  Button,
+  FormControl,
+  IconButton,
+  Input,
+  Select,
+  SelectItem,
+  Tooltip
+} from "@app/components/v2";
+import {
+  PermissionConditionOperators,
+  ProjectPermissionSub
+} from "@app/context/ProjectPermissionContext/types";
+
+import { TFormSchema } from "../ProjectRoleModifySection.utils";
+import { getConditionOperatorHelperInfo } from "./PermissionConditionHelpers";
+
+type Props = {
+  position?: number;
+  isDisabled?: boolean;
+};
+
+export const IdentityManagementPermissionConditions = ({ position = 0, isDisabled }: Props) => {
+  const {
+    control,
+    watch,
+    formState: { errors }
+  } = useFormContext<TFormSchema>();
+  const permissionSubject = ProjectPermissionSub.Identity;
+  const items = useFieldArray({
+    control,
+    name: `permissions.${permissionSubject}.${position}.conditions`
+  });
+
+  return (
+    <div className="mt-6 border-t border-t-mineshaft-600 bg-mineshaft-800 pt-2">
+      <p className="mt-2 text-gray-300">Conditions</p>
+      <p className="mb-2 text-sm text-mineshaft-400">
+        When this policy should apply (always if no conditions are added).
+      </p>
+      <div className="mt-2 flex flex-col space-y-2">
+        {items.fields.map((el, index) => {
+          const condition =
+            (watch(`permissions.${permissionSubject}.${position}.conditions.${index}`) as {
+              lhs: string;
+              rhs: string;
+              operator: string;
+            }) || {};
+          return (
+            <div
+              key={el.id}
+              className="flex gap-2 bg-mineshaft-800 first:rounded-t-md last:rounded-b-md"
+            >
+              <div className="w-1/4">
+                <Controller
+                  control={control}
+                  name={`permissions.${permissionSubject}.${position}.conditions.${index}.lhs`}
+                  render={({ field, fieldState: { error } }) => (
+                    <FormControl
+                      isError={Boolean(error?.message)}
+                      errorText={error?.message}
+                      className="mb-0"
+                    >
+                      <Select
+                        defaultValue={field.value}
+                        {...field}
+                        onValueChange={(e) => field.onChange(e)}
+                        className="w-full"
+                      >
+                        <SelectItem value="identityId">Identity ID</SelectItem>
+                      </Select>
+                    </FormControl>
+                  )}
+                />
+              </div>
+              <div className="flex w-36 items-center space-x-2">
+                <Controller
+                  control={control}
+                  name={`permissions.${permissionSubject}.${position}.conditions.${index}.operator`}
+                  render={({ field, fieldState: { error } }) => (
+                    <FormControl
+                      isError={Boolean(error?.message)}
+                      errorText={error?.message}
+                      className="mb-0 flex-grow"
+                    >
+                      <Select
+                        defaultValue={field.value}
+                        {...field}
+                        onValueChange={(e) => field.onChange(e)}
+                        className="w-full"
+                      >
+                        <SelectItem value={PermissionConditionOperators.$EQ}>Equal</SelectItem>
+                        <SelectItem value={PermissionConditionOperators.$NEQ}>Not Equal</SelectItem>
+                        <SelectItem value={PermissionConditionOperators.$IN}>Contains</SelectItem>
+                      </Select>
+                    </FormControl>
+                  )}
+                />
+                <div>
+                  <Tooltip
+                    asChild
+                    content={getConditionOperatorHelperInfo(
+                      condition?.operator as PermissionConditionOperators
+                    )}
+                    className="max-w-xs"
+                  >
+                    <FontAwesomeIcon icon={faInfoCircle} size="xs" className="text-gray-400" />
+                  </Tooltip>
+                </div>
+              </div>
+              <div className="flex-grow">
+                <Controller
+                  control={control}
+                  name={`permissions.${permissionSubject}.${position}.conditions.${index}.rhs`}
+                  render={({ field, fieldState: { error } }) => (
+                    <FormControl
+                      isError={Boolean(error?.message)}
+                      errorText={error?.message}
+                      className="mb-0 flex-grow"
+                    >
+                      <Input {...field} />
+                    </FormControl>
+                  )}
+                />
+              </div>
+              <div>
+                <IconButton
+                  ariaLabel="plus"
+                  variant="outline_bg"
+                  className="p-2.5"
+                  onClick={() => items.remove(index)}
+                >
+                  <FontAwesomeIcon icon={faTrash} />
+                </IconButton>
+              </div>
+            </div>
+          );
+        })}
+      </div>
+      {errors?.permissions?.[permissionSubject]?.[position]?.conditions?.message && (
+        <div className="flex items-center space-x-2 py-2 text-sm text-gray-400">
+          <FontAwesomeIcon icon={faWarning} className="text-red" />
+          <span>{errors?.permissions?.[permissionSubject]?.[position]?.conditions?.message}</span>
+        </div>
+      )}
+      <div>{}</div>
+      <div>
+        <Button
+          leftIcon={<FontAwesomeIcon icon={faPlus} />}
+          variant="star"
+          size="xs"
+          className="mt-3"
+          isDisabled={isDisabled}
+          onClick={() =>
+            items.append({
+              lhs: "identityId",
+              operator: PermissionConditionOperators.$EQ,
+              rhs: ""
+            })
+          }
+        >
+          Add Condition
+        </Button>
+      </div>
+    </div>
+  );
+};
diff --git a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/PermissionConditionHelpers.tsx b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/PermissionConditionHelpers.tsx
index 21fad117a..212f38e92 100644
--- a/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/PermissionConditionHelpers.tsx
+++ b/frontend/src/views/Project/RolePage/components/RolePermissionsSection/components/PermissionConditionHelpers.tsx
@@ -21,6 +21,7 @@ export const renderOperatorSelectItems = (type: string) => {
   if (type === "secretTags") {
     return <SelectItem value={PermissionConditionOperators.$IN}>Contains</SelectItem>;
   }
+
   return (
     <>
       <SelectItem value={PermissionConditionOperators.$EQ}>Equal</SelectItem>