Data Localisation: Imposing restrictions on cross-border data flows can severely impact the growth of India’s digital trade which has a potential to grow to Rs 12.8 lakh crore by 2030, said a report prepared by Hong Kong-based Hinrich Foundation.
The report estimates more than 200% growth in the total value of virtual goods and services enabled by digital economy and e-commerce from present $58 billion to $197 billion by 2030. However, it will require open cross-border data flows without any curbs. It advocates free flow of storage and processing technologies such as cloud-based services across the borders without any restrictions to take advantage of the technology.
“To maintain and even enhance this strong performance, India’s strategy in its export markets must be supported by greater cross-border data exchanges, processing and storage,” said the report jointly prepared by AIMA and Hinrich Foundation. It said the free flow of data flow will make digital economy and e-commerce India’s second-largest export.
In addition to benefits to India’s export sector, the report estimates that the free flow of cross-border data will result in large benefits domestic economy as well. It said that if digital trade and cross-border data flows and storage are fully facilitated then the value of benefits to India’s domestic economy could grow by more than 14-fold to reach $512 by 2030 from $35 billion today.
The report said free flow of information and data services will enable Indian SMEs to digitally engage with the global supply chain and customers that will reduce the time and cost for MSME sector.
The report comes in the backdrop of Reserve Bank of India’s direction to global tech giants to compulsorily store all payments data locally. However, the move was vehemently opposed by the global financial services companies.
Draft personal data protection also mandates foreign tech giants to locally store all data of Indian users. It also resulted in strong reaction and lobbying by global tech giants saying that it will restrict their services and increase the cost of their operations.
Source: financialexpress.com