Data Localization is the next big thing. There are industrialists from developing country pleading their governments to amend rules so that the social media giants will not take data back to their country. Data is the new oil like we all know, we have heard it before and we are aware of how data is going to cost more than anything in the world and there are countries which don’t have rules for the same. India is one of those countries.
India is one of those countries which did not have any rules for foreign companies to do their business in the sub-continent. That said, the companies were also taking back the data as well. Apart from evading taxes, the companies were doing a lot of things which were criminal in other countries but not in India. These are the reason the government has now got out stricter rules and the foreign companies are getting it back. It is hard for them to survive as the Indian tech lobby is now celebrating while the foreign companies are fighting for existence in India.
The Indian companies like Paytm, Sharechat, and Reliance Jio were happy while the foreign companies like Facebook, Google, Amazon, and even China’s ByteDance struggled. The new rules are technically sound and they certainly follow the steps of how China managed to flush out major foreign companies. However, India is not trying to flush out the companies but just showing them how hard it is going to be.
There are some footsteps taken to enable Indian companies more and turn down the volume increased by foreign companies. There is a huge sigh of relief by the Indian startups. The American and the Chinese company had infiltrated the Indian space and the Indian startups were getting overridden by these companies with big bucks. However, now there will be even ground and Indian startups will have space to breathe.
This has a lot to do with data localization as the government has asked Facebook, Google and all the other social media companies to localize the data. This has increased a lot of work for the companies and has created a space for the Indian startups as they are immune to this kind of regulations.
India welcomes foreign companies but the domination had no limit before this. The Indian government has, hence, taken steps to help the Indian startups and also gain control of all the data in the country. This is done so that no one will try and misuse the data and sell it. Mukesh Ambani talked about the same during the business summit in Gujarat a month ago.
Apart from this, the government bodies have come up with FDI policy as well. This is hampered the market of the e-commerce giants giving space to the local and offline retailers. This is how the government is gaining back the trust of the local businessmen and young startups.