{"id":7448,"date":"2022-08-19T00:00:00","date_gmt":"2022-08-19T00:00:00","guid":{"rendered":"https:\/\/www.nextias.com\/current_affairs\/uncategorized\/19-08-2022\/data-localisation\/"},"modified":"2025-08-04T12:48:01","modified_gmt":"2025-08-04T07:18:01","slug":"data-localisation","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/editorial-analysis\/19-08-2022\/data-localisation","title":{"rendered":"Data Localisation"},"content":{"rendered":"

In News\u00a0<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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  • The global politics of data is rapidly evolving as leading and emerging digital economies like the <\/span><\/span><\/span>European Union (EU), the U.S,India, Indonesia, and South Africa strive to protect, monetise, and leverage dat<\/strong><\/span><\/span><\/span>a collected within their <\/span><\/span><\/span>territories for domestic purposes.\u00a0<\/strong><\/span><\/span><\/span><\/li>\n<\/ul>\n

    Data localisation<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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    • It means <\/span><\/span><\/span>restricting the flow of data <\/strong><\/span><\/span><\/span>from one country to another. It means that the <\/span><\/span><\/span>personal data of a country\u2019s<\/strong><\/span><\/span><\/span> residents <\/span><\/span><\/span>should be processed and stored in that country<\/strong><\/span><\/span><\/span>.\u00a0<\/span><\/span><\/span><\/li>\n
    • As of now, much of cross-border data transfer is governed by individual bilateral \u201cMutual Legal Assistance Treaties\u201d (MLATs).<\/strong><\/span><\/span><\/span><\/li>\n<\/ul>\n
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      Data centre<\/strong><\/span><\/span><\/span><\/p>\n

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      • What is a data centre? <\/strong><\/span><\/span><\/span>It is a specialised physical facility of networked computers, storages and other information technology equipment<\/span><\/span><\/span><\/li>\n
      • Who uses data centres? <\/strong><\/span><\/span><\/span>Entities in online space use these to organise, process, store and disseminate large amounts of data.<\/span><\/span><\/span><\/li>\n
      • Such physical facilities are available all across the world and are not restricted by geographical borders.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        Need of Data localisation<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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        • Accessibility: <\/strong><\/span><\/span><\/span>If it is stored outside India, access to this data will be restricted by local laws and Indian agencies will be dependent on the whims and fancies of the host-country governments for access. It gives local governments and regulators the jurisdiction to call for the data when required.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
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          • Privacy and security concern: <\/strong><\/span><\/span><\/span>It may also enable the better exercise of privacy rights by Indian citizens against any form of unauthorised access to data, including by foreign intelligence.<\/span><\/span><\/span><\/li>\n
          • Avoiding foreign surveillance: <\/strong><\/span><\/span><\/span><\/span>It aims to protect the personal and financial information of the country\u2019s citizens and residents from foreign surveillance. In the case of data being stored in countries hostile to India, say China, it can become a tool for mass surveillance.<\/span><\/span><\/span><\/li>\n
          • Law enforcement benefits: <\/strong><\/span><\/span><\/span>This will be beneficial for law enforcement agencies in particular as they can scavenge it for proof in case of breach or threat.\u00a0<\/span><\/span><\/span><\/li>\n
          • Economic benefits: <\/strong><\/span><\/span><\/span>Increasing<\/span><\/span><\/span> economic interests have compelled governments to institute rules that restrict cross-border flows with implications for negotiations on global trade and commerce. The economic benefits will accrue to local industry in terms of creating local infrastructure, employment and contributions to the AI ecosystem.<\/span><\/span><\/span><\/li>\n<\/ul>\n

            Issues\u00a0<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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            • Foreign firms are <\/span><\/span><\/span>unwilling to comply as it would require<\/strong><\/span><\/span><\/span> them to spend money <\/span><\/span><\/span>\u00a0on compliance activities such as hiring data-protection officers or maintaining systems to get the government approvals to transfer data<\/strong><\/span><\/span><\/span><\/li>\n
            • Barriers to the free flow of data may hurt businesses by increasing delays and <\/span><\/span><\/span>higher costs of collaborative research or partnerships outside India.\u00a0<\/strong><\/span><\/span><\/span><\/li>\n
            • Entities would need multiple separate processing centres if they serve consumers <\/span><\/span><\/span>both within India and outside when a single centre would suffic<\/strong><\/span><\/span><\/span>e.<\/span><\/span><\/span><\/li>\n<\/ul>\n

              Global Efforts\u00a0<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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              • Indeed, the sheer amount of data being generated and shared globally has <\/span><\/span><\/span>necessitated governments <\/strong><\/span><\/span><\/span>to exert more <\/span><\/span><\/span>control over the use, sharing, and cross-border flow of data.\u00a0<\/strong><\/span><\/span><\/span><\/li>\n
              • According to the Information Technology and Innovation Foundation (ITIF), <\/span><\/span><\/span>data localisation laws have more than doubled from 2017 to 2021, <\/strong><\/span><\/span><\/span>indicating that states seek and want i<\/span><\/span><\/span>ncreasing levels of regulatory control over data.<\/strong><\/span><\/span><\/span><\/li>\n
              • The US administration recently issued an executive <\/span><\/span><\/span>order on promoting competition<\/strong><\/span><\/span><\/span> in the American economy that pushed for the use of <\/span><\/span><\/span>antitrust policy<\/strong><\/span><\/span><\/span> to meet the <\/span><\/span><\/span>challenges posed by the rise of dominant platform<\/strong><\/span><\/span><\/span>s, and surveillance.<\/span><\/span><\/span><\/li>\n
              • \u00a0European policymakers<\/strong><\/span><\/span><\/span> have introduced a bevy of digital rules that place individual users centre-stage, and enhancing their data security.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                • \u00a0The Chinese<\/strong><\/span><\/span><\/span> government mandates localisation for all \u201cimportant data\u201d held by \u201ccritical information infrastructure\u201d and any cross border personal data transfer must undergo a security assessment.<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                  Role of G20\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n
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                  • The<\/span><\/span><\/span> G20 appears as a viable platform to discuss data<\/strong><\/span><\/span><\/span>, particularly sharing and transfer, given seemingly converging positions on data governance amongst major G-7 powers and <\/span><\/span><\/span>emerging economies<\/strong><\/span><\/span><\/span> as the state finds a<\/span><\/span><\/span> greater role in regulating data.\u00a0<\/strong><\/span><\/span><\/span><\/li>\n
                  • Moreover, the G20\u2019s track record as the apex forum to discuss<\/span><\/span><\/span> global economic issues gives<\/strong><\/span><\/span><\/span> it <\/span><\/span><\/span>legitimacy and having the top (digital) economies<\/strong><\/span><\/span><\/span> makes it an appropriate forum to discuss data.\u00a0<\/span><\/span><\/span><\/li>\n
                  • The G20 does not create binding rules but serves as a platform to catalyse and inject new thinking around critical current issues.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

                    India\u2019s Efforts\u00a0<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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                    • Since 2017, India has attempted to i<\/span><\/span><\/span>ncubate governance of non-personal<\/strong><\/span><\/span><\/span> data, personal data, e-commerce regulation <\/strong><\/span><\/span><\/span>and <\/span><\/span><\/span>artificial intelligence (AI) <\/strong><\/span><\/span><\/span>with a preference to <\/span><\/span><\/span>harness \u201cIndia\u2019s data for India\u2019s development<\/strong><\/span><\/span><\/span>.\u201d\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                      • These policies, including the recently withdrawn<\/span><\/span><\/span> Personal Data Protection Bil<\/strong><\/span><\/span><\/span>l, are works in progress but this does not take away from the <\/span><\/span><\/span>vast ecosystem of actors<\/strong><\/span><\/span><\/span> \u2014 including experts, civil society, and industry actively engaging with and attempting to shape digital policy-making.<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                        • In 2018, based on the recommendations of the <\/span><\/span><\/span>Justice Srikrishna Committee, the Reserve Bank of India (RBI) <\/strong><\/span><\/span><\/span>\u00a0mandated companies to <\/span><\/span><\/span>locally store and process sensitive data<\/strong><\/span><\/span><\/span> belonging to Indian users of various digital payment services.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                          • Until then, most data from<\/span><\/span><\/span> India was being stored on a cloud database outside the country<\/strong><\/span><\/span><\/span><\/li>\n<\/ul>\n

                            Conclusion and Way Forward\u00a0<\/u><\/strong><\/span><\/span><\/span><\/h2>\n
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                            • To underscore political rhetoric and drive global data discussions at the G20, the Indian government s<\/span><\/span><\/span>hould present a holistic agenda<\/strong><\/span><\/span><\/span> that embeds data collection and sharing within a <\/span><\/span><\/span>broader framework<\/strong><\/span><\/span><\/span> that <\/span><\/span><\/span>prioritises digital security, innovation, and citizen rights.<\/strong><\/span><\/span><\/span><\/li>\n
                            • For instance, the Reserve Bank of India\u2019s data localisation directive has been in place for four years now.<\/span><\/span><\/span>\n
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                              • \u00a0An <\/span><\/span><\/span>empirical assessment of how this has impacted both start-ups<\/strong><\/span><\/span><\/span>, big <\/span><\/span><\/span>technology companies, and users could serve as a useful exampl<\/strong><\/span><\/span><\/span>e.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
                              • \u00a0India\u2019s digital economy stewardship<\/strong><\/span><\/span><\/span> must transcend<\/span><\/span><\/span> data localisation<\/strong><\/span><\/span><\/span> by highlighting best practices on data protection, competition law, data stewardship, and responsible artificial intelligence both in India and other G20 countries.<\/span><\/span><\/span><\/li>\n
                              • The ongoing effort to redraft the<\/span><\/span><\/span> Personal Data Protection Bil<\/strong><\/span><\/span><\/span>l and embed it within a \u2018more comprehensive framework\u2019 that<\/span><\/span><\/span> addresses related concerns<\/strong><\/span><\/span><\/span> like <\/span><\/span><\/span>cybersecurity must serve as an urgent domestic priority<\/strong><\/span><\/span><\/span>, and<\/span><\/span><\/span> could lend weight to India\u2019s G20 data approach.<\/strong><\/span><\/span><\/span><\/li>\n<\/ul>\n
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                                Mains Practise Question\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n

                                [Q]<\/strong><\/span><\/span><\/span> The G20 appears as a viable platform to discuss data, particularly sharing and transfer.Comment\u00a0<\/span><\/span><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

                                In News\u00a0 The global politics of data is rapidly evolving as leading and emerging digital economies like the European Union (EU), the U.S,India, Indonesia, and South Africa strive to protect, monetise, and leverage data collected within their territories for domestic purposes.\u00a0 Data localisation It means restricting the flow of data from one country to another. […]<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[22],"tags":[114,26],"class_list":["post-7448","post","type-post","status-publish","format-standard","hentry","category-editorial-analysis","tag-cyber-crime-security","tag-gs-3"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/7448","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=7448"}],"version-history":[{"count":0,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/7448\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=7448"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=7448"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=7448"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}