US social media major Facebook has called on India to allow free flow of data across borders to discover its true value, and urged the country to not “hoard” it, saying it’s not a finite commodity like oil which can lead to prosperity in the future due to higher reserves.
“There are many in India and around the world who think of data as the new oil, and that, like oil, having a great reserve of it held within your national boundaries, will lead to sure fire prosperity. But this analogy is mistaken,” Nick Clegg, global head for public policy at Facebook, said at an event on Thursday.
“Data isn’t oil—a finite commodity—to be owned and traded, pumped from the ground and burned in cars and factories. Of course, no analogy is perfect, but a better liquid to liken it to is water, with the global internet like a great borderless ocean of currents and tides,” Clegg added.
His views were in contrast to those of Reliance Industries chairman Mukesh Ambani who has repeatedly described data as the new oil. He is visiting India at a time the country is readying its Personal Data Protection (PDP) Bill, which seeks to mandate companies collecting data of Indian citizens to store certain ‘çritical’ data only within the country. Foreign companies have opposed the move, worried that it would hurt their planned investments by raising costs related to setting up new local data centres.
Clegg said that the true value of data comes from allowing data to flow freely and encouraging the innovation that stems from it.
“It is that innovation that has the potential to bring much greater wealth to India and it is that innovation that will place India, with its entrepreneurial society and its bedrock of engineering talent, at the forefront of the global internet for decades to come,” he said.
Clegg said to restrict data flow outside the country would be to “turn this great ocean of innovation into a still lake…The global internet is built on this principle of cross-border data flows just as the global economy relies on capital, human resources and technological innovation to cross borders in order to flourish”.
Even as India works on its PDP law, the Reserve Bank of India last year imposed data localisation norms on foreign fintech companies to locally store the data of Indians.
Facebook, which is looking at launching payment services through its unit WhatsApp in India, and global firms such as Mastercard, Visa, PayPal, Google and Amazon had sought relaxation in the regulation on data localisation. India is home to 400 million WhatsApp users and more than 328 million Facebook users, thus a key market for the US social media major.
The Facebook executive said that besides economy, data sharing is crucial for national security.
“Yet, right now India finds itself locked out of major global data-sharing initiatives aimed to clamp down on serious crime and terrorism, like the Clarifying Lawful Overseas Use of Data (CLOUD) Act and the Budapest Convention on Cyber Crime,” he said.
Clegg urged the Indian government to revive its bilateral relationship with the US on cyber co-operation, given that India and the US are in conflict on issues related to data sharing.
“In our view, a major priority for the US and India should be to revive their bilateral relationship on cyber co-operation and for India to seek access to these existing mechanisms for data sharing. Now is not the time to drift further apart, now is the time to get around the table and agree on a data-sharing relationship that suits both sides,” he said.
He said that India finds itself at a crossroads as the internet matures, and its decisions going forward would play a crucial role in shaping the global internet.
If India choose the data localisation, “between these two great nations, China and India, a third of the world’s population would be detached from the rest of the global internet and a great precedent would be set for other nations. And in a few short years there may not be such a thing as a global internet at all,” he said, adding some countries would use India as a precedent to justify even more restrictive laws.
“Or instead, India can choose to work with its natural allies in the open, democratic world to help shape an internet that respects rights of individuals; promotes competition and innovation; and remains open and accessible for all.”―India Finance News