E-commerce companies like Flipkart and Amazon may have to store user-data exclusively in India in view of security and privacy concerns, according to a draft policy discussed at a meeting of a high-level think tank on Monday.
The draft recommendations were prepared by several stakeholders, including by the private sector and government officials from departments such as commerce, industry, IT and electronics. The suggestions were discussed by the think tank headed by commerce minister Suresh Prabhu at a meeting in the national capital.
The think tank will now work on the final draft national policy for the e-commerce sector, based on the recommendations, which would be placed in the public domain for further comment.
The draft policy, according to The Economic Times, “makes a strong case for championing Indian online enterprise”. The draft suggests that there should be differential voting rights for Indian founders with minority stakes, giving them more control, the newspaper reported.
Data policy
Data that would be required to be stored exclusively in India includes “community data collected by IoT (Internet of Things) devices in the public space; and data generated by users in India from various sources, including e-commerce platforms, social media, search engines etc”, according to the initial draft.
The draft also talks about the government having access to data stored in India for national security and public policy objectives.
On competition issues
The draft suggested that the Competition Commission of India (CCI) must consider amending the threshold limit that examines potential competition distorting mergers and acquisitions (M&A). A level playing field was suggested for domestic players by ensuring that foreign websites, involved in e-commerce transactions from India also follow domestic rules.
Bulk purchase of branded goods, especially mobile phones, which lead to price distortions in the marketplace may be banned, the initial draft stated.
It was suggested that the government should set up a separate wing in the Directorate of Enforcement to handle complaints related to the implementation of guidelines related to foreign direct investment (FDI) in the e-commerce sector.
Briefing reporters post the meeting, the officer on special duty (OSD) Anup Wadhawan, the new commerce secretary, said the recommendations that were discussed on Monday were very comprehensive in nature and cover each aspect of the e-commerce business, like data flows, consumer protection, grievance redressal, logistics and server localisation.
“Draft in line with Srikrishna panel proposals”
The report of the Justice BN Srikrishna committee on data protection has also come out, Wadhawan said, adding that data localisation issues were deliberated upon as “data provisions has to balance the interest of promoting business with security and privacy concerns”.
He said that the final draft will be in line with the recommendations of the Justice Srikrishna Committee report on data privacy, The Hindu reported.
When will the final policy be out?
Wadhawan said that there is no timeline for release of the final policy, but that the nation “…cannot afford to have a vacuum in the e-commerce space.”
What stakeholders have to say?
Commenting on the initiative, the Confederation of All India Traders (CAIT) said they are demanding a policy and a regulator for the sector. CAIT said the draft speaks about the adoption of RuPay cards as payment technology.
A Snapdeal spokesperson said the framework for a national policy on e-commerce represents the collective output of a well-structured discussion on key issues pertaining to the future of the sector.
Representatives from NASSCOM, CII, FIEO, FISME, the Electronics and Computer Software Export Promotion Council, the Internet and Mobile Association of India (IMAI), telecom majors Bharti Enterprises, Reliance Jio Infocom, software firms TCS, Infosys, WIPRO, Mindtree, Tech Mahindra, cab aggregator Ola, MakeMyTrip, and Urban Clap participated in the meeting.
Traders laud govt’s move to formulate policy
Traders welcomed the government’s move to formulate an e-commerce policy that mandates local storage of user data, and hoped the policy will help build robust reform. The “think tank should address a national framework on e-commerce for a robust internal reform,” Praveen Khandelwal, secretary general, The Confederation of All India Traders (CAIT), was quoted as saying in a statement.
