Challenges with cross border data

What is the issue?

In the present digital era, the governance of cross-border data is a major challenge for countries.

What is cross border data?

The increased digitalization has made data an input to commerce, and made data of one nation to travel to another.
It is a simple fact that international trade involving consumers cannot take place without collecting and sending personal data across borders.
It makes industries streamline their business practices and increase efficiency.

What are the global dilemmas in addressing this?

Governance of cross-border data through trade agreements is a major challenge for countries, since it is difficult to regulate.
There are differences among countries in outlooks and approaches to data security and its commercial use.
Many countries consider fundamental rights of citizens, including the right to privacy of data, superior to trade rights.
It is difficult to determine the ‘optimal’ level of data protection content in trade agreements that would simultaneously satisfy both protection and innovation.

What are the challenges for India?

India struggles to discover regulations that would facilitate its economic growth while ensuring data flow doesn’t affect citizens' privacy.
Creating effective domestic regulations is a big challenge.
The choice of the right policy mix is difficult as they may overlap with other complex trade issues such as IPR.
Foreign investments in Make-in-India industries would be influenced by data regulations.
Data regulations are also critical in terms of the security risks they involve, particularly financial risks arising from lapses in cyber security and data theft.

What can be done?

India must be prepared to accept that data regulations and digital trade rules, which it would negotiate in future.
India needs to move towards domestic regulations on digital trade, ensuring sufficient security of private data.
India’s domestic regulations on cross-border flow of data must also reflect contemporaneity.
Data rules and digital trade governance deserve much greater attention from India than it has got till now.

Source: Financial Express