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Prime Minister’s Office Stand On Data Localisation Soon

The Prime Minister’s Office (PMO) will take a call on India’s position on data localisation, considering its strategic and security aspects, even as it asked for fresh consultations on the proposed Personal Data Protection Bill.

While the commerce and industry ministry had called for strict data localisation norms in its draft e-commerce policy, the electronics and information technology ministry is working on the Personal Data Protection Bill and has become the nodal agency for all data-related matters.

Separately, the Reserve Bank of India has clarified that a copy of domestic data can be stored abroad in the case of cross-border transactions. “The matter is now with the PMO. They will firm up India’s stance on data localisation,” said an official aware of the development.

The PMO’s intervention comes as the government works towards finalising the national e-commerce policy amid the US’ opposition to India’s policies and proposed norms related to data, besides linking it with trade issues. The US has criticised India’s draft e-commerce policy for data localisation requirements, restrictions on cross-border data flows, transfer of intellectual property and proprietary source codes, and preferential treatment for domestic digital products, terming certain proposals as “most discriminatory and trade-distortive”.

On the RBI’s requirement that all payment-related data must be stored in India, the United States Trade Representative (USTR) office said this requirement raises costs by forcing the construction of redundant data centres and prevents local firms from taking advantage of the best global services available.

The US has also disapproved of the draft Personal Data Protection Bill, saying if passed into law, it would “impose onerous burdens on firms, especially foreign firms, that process personal information”.

The official said the matter has been under the PMO’s consideration and a decision is expected after the ongoing session of Parliament ends on Wednesday.

“The US has opposed India’s policies, irrespective of the department that floated them. However, the top political quarters understand the strategic importance of data, predominantly the security angle, especially when many countries including China and the US have dedicated official social media warfare cells,” said a New Delhi-based expert on e-commerce issues.

Incidentally, South Africa is also grappling with multiple agencies involved in e-commerce issues. While its Department of Trade and Industry is responsible for international trade and negotiating at the World Trade Organization, the presidential commission on the fourth industrial revolution was put in place in April to recommend policies on digital trade.―India Finance News

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