Prime Minister Narendra Modii's cabinet on Wednesday gave its go-ahead to the “Personal Data Protection Bill, 2019” despite strong opposition from the US.
Short statement : As per news reports the Union Cabinet has approved the Data Protection Bill. We look forward to it’s introduction in Parliament. and welcome progress towards a transformative legislative proposal to protect citizens in our increasingly digital society. 1/2— Internet Freedom Foundation (IFF) (@internetfreedom) December 4, 2019
The bill, which will identify which data can be classified as personal, sensitive or critical, is likely to affect the operations of multinational corporations in India due to its data localisation requirement and restrictions on cross-border data transfer.
Earlier in November it was reported that the Information Technology Industry (ITI) Council - a US-based global lobby body for technology companies, said that India’s mandate on data localisation could prove detrimental to tech companies in more than one way, especially because it would add 30 to 60 percent more capital investments from foreign firms.
India’s Ministry of Electronics and Information Technology (MeitY) moved the Bill in the Cabinet meeting, where Information and Broadcasting Minister Prakash Javadekar noted that this Bill would look at protection methods in India to safeguard citizens against the risk of cyber-threats.
Electronics and Information Technology Minister Ravi Shankar Prasad had recently informed the Indian parliament that this bill was already under preparation and would be soon ready to be introduced to the lawmakers.
The drafting of this Bill has been going on for a while now.
In August 2017, a special committee headed by retired Supreme Court Judge, B.N. Srikrishna, was established in India to fast-track the development of the “Personal Data Protection Bill”.
In July 2018, the special committee submitted a Draft Bill on data privacy to the government, outlining suggestions and rules on the collection, processing and storage of the personal data of Indian citizens.
The draft also proposed repercussions in the event of a breach, highlighting penalties, compensations, a code of conduct for foreign companies operating in India and an enforcement model.
The latest development comes at a time when Chinese companies like Huawei are all set to enter into no-backdoor agreements with India ahead of the next 5G trial in the country.
Back in October this year, US-based financial services corporation Mastercard, which has invested to the tune of billions of dollars in India, said it was confident about completing its data localisation requirements in India by the year-end.
However, the card payments major believes that restricting data flows in digital transactions would affect the quality of fraud detection and assessment.