The government proposed a policy which bars companies from sharing data with third-party entities, even if there is customer consent
Tech giant Microsoft is seeking relaxation in data storage rules under the new e-commerce policy proposed by the government, wanting permission to share data with group companies to help development of business and customer relations, Financial Express reported.
The Department for Promotion of Industry and Internal Trade (DPIIT) held a meeting with all stakeholders earlier this month after releasing a draft of the policy.
"Some stakeholders, including startups, were of the view that foreign investors generally calculate the business value of a startup or a company based upon the offerings and data that it has. Not allowing data sharing could potentially limit acquisition and investment opportunities for foreign companies in Indian startups," the newspaper quoted a source as saying.
Startups are also working on technology that assists artificial intelligence and requires the participation of major tech companies around the world and draws investments from large MNCs. If data sharing is not allowed, this could be impacted adversely.
According to the proposed policy, data sharing with third-party entities is barred, even if there is customer consent. This policy aims to regulate the flow of data across borders and establish a framework for its sharing.
In the meeting, stakeholders said that there is ambiguity around the word 'third-party', which means companies like Microsoft and Amazon cannot share the data even with their own parent or subsidiary. "Some stakeholders want the government to allow data sharing among companies who are a part of the same conglomerate or are subsidiaries. Microsoft favoured this suggestion," another source present at the meeting said.There were many big stakeholders who have no issue about the new norms that require them to store data locally, including companies like Netflix, Amazon, Uber, Ola and traders.