US urges India to soften data localization stance

Monday 15 October 2018 10:41 CET | News

Two US senators have called on Indian Prime Minister Narendra Modi to soften India’s stance on data localization, according to Reuters.

The warning came as such measures represent “key trade barriers” between the two nations. Thus, India is urged to adopt a “light touch” regulatory framework that would allow data to flow freely across borders.

At the beginning of October 2018, the Reserve Bank of India told top payment company officials that the central bank would implement, in full, its data localization directive without extending the deadline, or allowing data to be stored both offshore as well as locally - a practice known as data mirroring.

Other than the RBI proposal, India is working on an overarching data protection law that calls for storing all critical personal data in India. Ecommerce and cloud computing policies are also being developed.

Mastercard, Visa, and American Express have been lobbying India’s finance ministry and RBI to relax proposed rules that require all payment data on domestic transactions in India be stored inside the country by October 15.

These measures have unnerved some tech companies who fear it will increase their infrastructure costs, according to Reuters, hit their global fraud detection analytic platforms, and affect planned investments in India at a time when more and more Indians are going online and using digital payments.

Modi’s office did not immediately respond to an email seeking comment, the online publication continues.

The measures in India come at a time when countries around the world are announcing stringent rules to regulate how companies store data and protect privacy, in the aftermath of Facebook’s Cambridge Analytica scandal.

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Keywords: data localization, India, US, ecommerce, data protection law, fraud detection analytic platforms, data privacy
Countries: World

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