American Tech Giants Wary of India’s Data Localization Move – Report

© AFP 2022 / LEON NEALA picture shows the logo of the online retailer Amazon dispalyed on computer screens in London on December 11, 2014
A picture shows the logo of the online retailer Amazon dispalyed on computer screens in London on December 11, 2014 - Sputnik International
A report by Reuters claims that American trade groups representing companies such as Amazon, American Express and Microsoft have opposed India's push to protect the user data of its citizens.

New Delhi (Sputnik) — American technology giants are planning intense lobbying against proposed data protection laws in India, which include a government plan to make data storage localization mandatory for foreign firms in India. 

Reuters, in a recent report, pointed out that the Indian move could undermine already strained economic relations between India and the United States as the American tech industry has considered pitching the issue as a trade concern, including at a 2+2 dialogue slated for September this year. 

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"It will be a litmus test to who our establishment serves," a senior security and strategy consultant working closely with the Indian government told Sputnik under the condition of anonymity. 

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A committee set up by the Indian government on data privacy last month proposed a draft law, a copy of which was obtained by Sputnik. The draft law recommends restrictions on data flows and proposes that the personal data of Indian citizens should be processed only within the country. 

American technology firms worry that the mandate would hurt their planned investments by raising costs related to the establishment of new local data centers.

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"In a meeting, last week organized by lobby group US-India Strategic Partnership Forum, executives from Facebook, Mastercard, Visa, American Express, PayPal, Amazon, Microsoft and others discussed plans to approach Indian lawmakers, including Indian parliamentary panels on information technology (IT) and finance, sources said. The industry also discussed approaching media and internet groups to explain why data localization would be bad for India's booming IT, e-commerce and payments landscape," the Reuters report reads.

The increasing use of digital platforms in India for shopping or social networking have made it a lucrative market for technology companies, but a rising number of data breaches have pushed New Delhi to develop strong data protection rules.

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