US sen­a­tors urge In­dia to soften data stor­age stance

Gulf Times - - INDIA -

Two US sen­a­tors have called on Prime Min­is­ter Naren­dra Modi to soften In­dia’s stance on data lo­cal­i­sa­tion, warning that mea­sures re­quir­ing it rep­re­sent “key trade bar­ri­ers” be­tween the two na­tions.

In a let­ter to Modi dated Fri­day and seen by Reuters, US Sen­a­tors John Cornyn and Mark Warner – co-chairs of the Se­nate’s In­dia cau­cus that com­prises over 30 sen­a­tors – urged In­dia to in­stead adopt a “light touch” reg­u­la­tory frame­work that would al­low data to flow freely across bor­ders.

The let­ter comes as re­la­tions be­tween Wash­ing­ton and New Delhi are strained over mul­ti­ple is­sues, in­clud­ing an Indo-Russian de­fence con­tract, In­dia’s new tar­iffs on elec­tron­ics and other items, and its moves to buy oil from Iran de­spite up­com­ing US sanc­tions.

Global pay­ments com­pa­nies in­clud­ing Master­card, Visa and Amer­i­can Ex­press have been lob­by­ing In­dia’s fi­nance min­istry and the Re­serve Bank of In­dia to re­lax pro­posed rules that re­quire all pay­ment data on do­mes­tic trans­ac­tions in In­dia be stored in­side the coun­try by Oc­to­ber 15.

The let­ter is most likely a last­ditch ef­fort af­ter the RBI told of­fi­cials at top pay­ment firms this week that the cen­tral bank would im­ple­ment, in full, its data lo­cal­i­sa­tion di­rec­tive with­out ex­tend­ing the dead­line, or al­low­ing data to be stored both off­shore as well as lo­cally – a prac­tice known as data mir­ror­ing.

“We see this (data lo­cal­i­sa­tion) as a fun­da­men­tal is­sue to the fur­ther de­vel­op­ment of dig­i­tal trade and one that is cru­cial to our eco­nomic part­ner­ship,” the US sen­a­tors said in the let­ter that has not been pre­vi­ously re­ported.

Modi’s of­fice did not im­me­di­ately re­spond to an e-mail seek­ing com­ment.

Other than the RBI pro­posal, In­dia is work­ing on an over­ar­ch­ing data pro­tec­tion law that calls for stor­ing all crit­i­cal per­sonal data in In­dia.

E-com­merce and cloud com­put­ing poli­cies are also be­ing de­vel­oped.

The let­ter also raised con­cerns on the draft data pro­tec­tion bill and e-com­merce pol­icy frame­work that called for strin­gent lo­cal­i­sa­tion mea­sures.

Th­ese mea­sures have un­nerved some tech com­pa­nies who fear it will in­crease their in­fra­struc­ture costs, hit their global fraud de­tec­tion an­a­lytic plat­forms and af­fect planned in­vest­ments in In­dia at a time when more and more In­di­ans are go­ing on­line and us­ing dig­i­tal pay­ments.

US lobby groups, that rep­re­sent com­pa­nies such as Face­book Inc, Ama­ and Al­pha­bet Inc-owned Google, have also voiced con­cerns about the pro­pos­als.

Shamika Ravi, a mem­ber of Modi’s eco­nomic ad­vi­sory coun­cil, had ear­lier told Reuters that the moves were in the “longterm strate­gic and eco­nomic in­ter­est” of the coun­try.

The sen­a­tors added that any con­cerns re­lated to “pro­tec­tion and se­cu­rity” as well as ac­cess to data for law­ful pur­poses were pos­si­ble with­out re­stric­tions on phys­i­cal lo­ca­tion, ac­cord­ing to the let­ter.

Gov­ern­ment sources have pre­vi­ously told Reuters though, that strin­gent data lo­cal­i­sa­tion mea­sures were es­sen­tial for gain­ing eas­ier ac­cess to data dur­ing in­ves­ti­ga­tions.

The mea­sures in In­dia come at a time when coun­tries around the world are an­nounc­ing strin­gent rules to reg­u­late how firms store data and pro­tect pri­vacy, in the af­ter­math of Face­book’s Cam­bridge An­a­lyt­ica scan­dal.

“We see this (data lo­cal­i­sa­tion) as a fun­da­men­tal is­sue to the fur­ther de­vel­op­ment of dig­i­tal trade and one that is cru­cial to our eco­nomic part­ner­ship”

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