New Delhi: Even as outsourcing demand from Europe revives after the debt crisis, data protection regulations in the region governing trans-border data flows could hurt the $108 billion Indian IT—ITeS industry, sectoral body Nasscom said.

“Challenges that I see are the U.S. Immigration Bill and the data security in Europe. These are areas that we are working on...I had gone (there) in September and had conversations with EU.”

”...security in Europe has the potential of going into directions which will not be conducive for (those) countries as well as our (IT) industry. They will get hurt and we will also get hurt,” Nasscom President R Chandrasekhar told reporters on the sidelines of the 3rd annual Action for India forum.

He added that engagement is a continuous process and Nasscom is in talks with concerned authorities across the globe on issues facing the industry.

The EU Data Protection Directive governs trans-border data flows and lays down conditions for transferring of personal data of EU citizens outside the region.

These legal instruments, together with the enforcement mechanisms across member countries, put too much obligations on businesses. Because of this, they are often considered as unfriendly to businesses especially small and medium—sized service providers.
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