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Our policies will prevent market distortion by dominant tech firms

“A trillion dollar digital economy.” “Open, safe, trusted, and accountable internet.” “Net neutrality.”

Such phrases appeared again and again in a conversation with Rajeev Chandrasekhar, minister of state for electronics and information technology, at his office. At almost every turn of an hour-long chat, the minister took out a pamphlet or a booklet to show that a plan was already in place to iron out the wrinkles in tech policy.

He started his career as part of the team that created the Pentium chip, was a telecom entrepreneur in the 1990s, and founded a media company more recently. Chandrasekhar is a technocrat-minister who is as comfortable talking about 5G hardware as he is debating the finer points of fundamental rights and their interplay with technology law.

“From what the honourable prime minister has set out as goals, the ministry’s mission is very clear. I don’t know if you’ve seen this,” he says, presenting the miniature version of a poster adorning one of the walls of his office.

“If you look at the third point, it says a trillion dollar digital economy. If you look at the first two, connecting Indians, and giving them an open, safe, trusted, and accountable internet, is as important,’’ he adds.

Moneycontrol met with the minister a day after the withdrawal of the data protection bill that had been in the works for the past few years. The conversation veered into adjoining areas of tech policy, as well such as the ban on Chinese apps, amendments to Information Technology Rules, indigenous 5G technology, and more.

You said earlier that the comprehensive set of policies regarding data protection will also deal with the concentration of ad tech in the hands of a few players. Can you share more details about the strategy?
We have two goals here. One is of course to get the internet to every Indian. But the internet must be open, safe, trusted, and accountable. Now, openness is the opposite of market dominance and concentration of power.

We expect our policies today and in the future to ensure that there is no market distortion by any platform. We don’t want our policies to create one or two platforms that decide monetisation of online content. We will certainly not be happy if there will be only one or two e-commerce platforms, for example.

We are an open democracy, an open country, a liberal society. For us, that openness means that any person who creates content – be it Moneycontrol or a young person sitting in Kerala – their ability to monetise that content should be equal. There should not be an imbalance in the power equation between the creator and the monetisation platform.

Talking about the IT Rules, several industry bodies have questioned the independence of the grievance appellate committee structure – and whether there would be one such committee or multiple. Can you shed some light on what is going on behind the scenes?
These grievance appellate committees would be multiple and digital. If the number of grievances are 10,000, obviously one committee won’t be able to handle it. Of course, it will be independent. The government has no interest in becoming an appellate committee.

It is because you (the intermediary) are not doing your job at the grievance level, that we are forced to create an appellate committee. If the intermediaries do their job, there is no need for anybody to come to the appellate committee.

And why is it that only when the government sits in an appellate committee that you ask about independence? When a large social media intermediary appoints their lawyer as a grievance officer, why aren’t they being questioned about independence?

What is an ideal set-up for a self-regulatory grievance redressal framework?
Ideal means anything that is effectively disincentivising an intermediary’s grievance redressal officer from playing football with a consumer’s grievances. The problem today is that the grievance officer model is patchy. Some people are doing a good job, while others are ignoring it.

We have announced a quarterly audit system of all intermediaries. Their compliance record will be published. We don’t want intermediaries to take accountability lightly. It is not something that we want from the intermediary. It has nothing to do with us. It has to do with the intermediary and the consumer.

We don’t want the intermediary to ignore legitimate grievances of the digital nagrik (citizen). There has to be real accountability. If they appoint a grievance officer, but do not respond to consumers’ mails, that is not acceptable.

There’s also been some criticism regarding introduction of a section regarding adherence to fundamental rights in the proposed amendments to the IT Rules 2021. What is your take on the issue?
What is the rationale of the pushback? We are saying, ‘Mr. Intermediary, I want you to make sure that whenever you offer a service in India, you should always respect the fundamental rights granted to an Indian citizen under the Constitution.’ And, what is your answer? ‘No, I will not’?

Perhaps, some of the intermediaries are contending that they have a better interpretation of the fundamental rights and exceptions therein?
That train has left the station – that they have a better understanding. I have a better understanding of what the citizen needs. The prime minister of the country has a better understanding of what the country needs.

A similar argument was made by Rahul Gandhi and P Chidambaram in July-August 2020, that we should follow the US model of economic policies, subsidies, and stimulus. Band kiska baja hain (who got burnt)? We are a confident nation today. We are creating killer apps, we are creating innovation that is competitive with the best in the world.

Many Chinese apps have faced bans in the country over the past couple of years. Does it mean that we do not trust the country’s software?
The app bans have nothing to do with China. Only those apps are being banned which violate Indian law. Apps from other countries like Singapore were also banned. It just so happened that a large number of the ones that were violating our laws, especially on privacy and digital data protection, were Chinese.

If you are an app, and you are sending data back in violation of our laws, you will be taken down. It has nothing to do with which country the app originated in.

At the beginning of the pandemic, the automatic route of foreign investments from neighbouring countries into Indian companies was restricted. This was perceived as a move to prevent opportunistic takeovers by Chinese companies. With fears of a funding crunch for start-ups setting in, will the stance be re-evaluated?
There is a global reset of risk appetite among investors. Whether Indian start-ups, or US start-ups, or Chinese start-ups – all have been impacted both in terms of volume of capital available, and valuation. This is happening due to the fear of a global recession.

The foreign investment stance is not driven by whether we want more money in the country or not. This is a geopolitical and national security stance. It will remain as long as there are national security challenges – and it will automatically moderate when those challenges moderate.

Chinese companies have been restricted from 5G trials so far. Is that policy going to remain going forward?
The exclusion (of China) is only in the hardware piece as our network infrastructure will always be from trusted sources. But it is not a concept that has been designed specifically for China alone.

Also, 5G is a technology that has much lower hardware intensity because it is built on concepts like open software, network virtualisation, etc. All those pieces of software that sit on the hardware are being developed by domestic start-ups, even though Qualcomm could be offering it (as an end product). When I say 5G is the first time we are offering indigenous technology, it is because a large part of the technology will be designed and developed in India.

By when do you think we can start producing semi-conductor chips?
The semi-conductor and electronics ecosystems are undergoing a tectonic shift today. Electronics is the second-most traded commodity in the world, after petroleum. Its market size is $1.5 trillion. The electronics supply chain was dominated by China before the Covid pandemic, but now more and more countries want trusted partners for electronics manufacturing, which has opened up a large opportunity for India.

Our target is to go from producing electronics worth $75 billion this year, to $350 billion by 2026 – $120 billion of which will be exports. That is our vision as a part of the trillion dollar digital economy.

As we become a huge player in electronics manufacturing, there will be a large inherent demand for semi-conductors as well. When we manufacture $300 billion of electronics, our demand for semi-conductors will be worth $110 billion. That will make us one of the largest consumers of semi-conductors, apart from the US. So it makes a lot of sense for someone to set up a semi-conductor plant in India.

The US is bringing a $52 billion subsidy programme for manufacturing chips domestically. Europe is expected to do the same. Will a large domestic market be enough of an attraction to make India a key part of their supply chain?
The market is the biggest attraction for anybody who comes to invest in India because we are a large market. The digitisation of the Indian economy is only at an early stage and we are going to have a lot of headroom for growth. Digitisation of health, education and MSMEs – all of that is going to create downstream effects on demand for electronics, which in turn spurs demand for semiconductors. MoneyControl

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