India’s lack of data protection laws limits FTA with UK

Free Trade Agreement negotiations are currently on between India and the United Kingdom. Meanwhile, some officials reportedly stated that as a data adequacy pact is a crucial component dominating talks between both the countries, the Centre may not be able to negotiate the parameters because India does not yet have data protection legislation.

According to one of the two officials, the lack of data protection legislation and an e-commerce policy limits bilateral trade talks.

The person also stated that since India’s policies are evolving and “we have to have policy space in the future”, the country is unable to make binding pledges, according to a Mint report.

However, according to a second official, talks between India’s ministry of electronics and information technology and Britain’s department for digital, culture, media and sport, will continue, and an outcome may be reached soon.

India and the United Kingdom have held two rounds of trade talks since January.

Following the completion of bilateral FTAs with the UAE and Australia, the central government has begun talks with a number of additional nations, including Canada.

Data protection legislation
India is currently in the transition to becoming a digital economy but the country doesn’t have comprehensive data protection legislation yet. However, some reports have claimed that the government might potentially replace the Personal Data Protection (PDP) Bill with new legislation. This bill was first introduced in 2019.

A joint parliamentary committee on data protection recently proposed many changes to the draft bill, including mandatory mirroring of all sensitive data locally and broadening the scope to include both personal and non-personal data.

The committee also suggested that the rule be implemented in stages, with a two-year transition time for compliance. Additionally, it stated that a formal authority for regulating social media sites should be established.

It should be understood that the most recent version of the PDP Bill includes non-personal data, “non-personal data breach,” and reporting requirements, while other aspects of data protection continue to apply only to personal data.

However, this has raised the question of why it is necessary to combine personal and non-personal data into a single data protection bill. Non-personal data, by definition, has no privacy implications, and the powers granted to the government to access non-personal data have been a source of concern since the 2019 draft.

As reported, Kevin McCole the managing director of the UK India Business Council said that British companies are asking for non-personal data transfer between the two nations to help them invest more in India.

He reportedly said that if both the countries can align their data regulations, it could improve trade relations and open up a new investment chapter.

Additionally, he said that “This is one of our key asks when we made our submission to both governments”.

India-UK FTA
According to UK India Business Council’s website, “Trade and Investment were front and centre when the Indian and UK Prime Ministers announced a “transformational” Comprehensive Strategic Partnership on 4 May 2021, with the signing of a UK-India Enhanced Trade Partnership (ETP) and commitments to double trade by 2030 and to start FTA negotiations by the end of 2021.”

It also stated that businesses are active participants in the process of negotiating the FTA. As a result, an active and open dialogue between business and government will be critical to the success of FTA negotiations and the achievement of the broader ETP goals.

Moreover, it said last September: “The UK India Business Council has long advocated for a UK-India FTA. We believe it is both the right ambition and is eminently achievable.”

“This summary of our formal submission to the UK’s Department for International Trade (DIT) and India’s Ministry of Commerce and Industry (MoCI) highlights a range of issues, on which businesses would like the UK and Indian Governments to focus to ensure that the target of doubling trade by 2030 is achieved,” it noted. News18