India's new data protection bill earns Big Tech, startup support

By Team Startupcity  |  Thursday, 08 December 2022, 09:20 IST

India's new data protection bill earns Big Tech, startup support
After protracted efforts that stretched over four years, Prime Minister Narendra Modi's government looks likely to win parliamentary approval for its personal data protection legislation.
A compromise bill put forth by the government tries to strike a balance between protecting data privacy and avoiding an onerous burden on businesses. The business sector has signaled its support.
Passage would finally put India's personal data regulations on par with those of Asian peers, improving the business environment.
On Dec. 1, representatives from the National Association of Software and Services Companies (NASSCOM) and leading startups met with Ashwini Vaishnaw, minister for railways, communications, electronics and information technology, who presented the new version.
Business representatives sounded satisfied with the revamped bill, saying it removes provisions "that would have posed significant concerns to ease of doing business," including strict requirements for businesses to store copies in India of the personal data of Indian residents.
Vaishnaw even proposed that businesses and startups "test the bill against their specific use cases to identify gaps" and offer their feedback to the government -- a marked departure from the highhanded approach often taken by the Modi government.
This may reflect the government's desperation as it hopes to make the fourth time the charm.
The first personal data protection bill, unveiled in the summer of 2018, had domestic and foreign companies up in arms over a requirement to store copies of personal data on Indian territory, regardless of the nationality of the businesses and the locations of their servers.
Two revised drafts were presented between then and this spring, but both ended up being withdrawn. Finally, the government crafted the latest bill, which turned out to be drastically different with easier local-storage requirement, allowing data to be transferred outside India to "certain notified countries and territories" where protections are in place.
Now, ahead of the parliamentary "Budget Session" to begin at the end of January, the prospect of legislative approval looks realistic at long last.
The idea that data created in one country is a resource belonging to that country was introduced by the European Union's General Data Protection Regulation, which took effect in 2018 and restricts international transfers. At the same time, The GDPR permitted data transfers to and storage in third countries deemed having adequate levels of protection.
This inspired countries in Asia to put appropriate data safeguards in place, with Australia, Singapore, Vietnam, Indonesia and the Philippines rushing to create proper legal frameworks. India is the last major Asian economy without proper personal data protection laws. Passage of the latest bill in India would help improve the business environment for startups that wish to freely store personal data collected here.

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