Data of consumers should be used for benefit of local economy: Indian ecommerce players

Senior officials of various digital commerce companies raised concerns over instances of non-compliance with FDI policy for ecommerce by foreign players.

Indian ecommerce companies on Monday flagged issues pertaining to safety of data of Indian users stored abroad and said such information related to consumers in the country should benefit the local economy.

Senior officials of various digital commerce companies, who met Commerce and Industry Minister Piyush Goyal on Monday, also raised concerns over instances of non-compliance with FDI policy for ecommerce by foreign players.

According to one of the persons present in the meeting, the primary view of these companies was that data of Indian consumers should be used for the benefit of the Indian economy, keeping the privacy of users in mind.

The minister has also asked these industry representatives to present any additional points they may have within one week, the person added.

Goyal is holding back-to-back meetings with Indian and foreign IT, ecommerce firms, and other stakeholders to discuss issues related with online trade and data localisation. Some of the big names include Google, IBM, MasterCard, Amazon, Ola, Reliance Jio, Paytm, Makemytrip, Snapdeal and Infosys. 

Another domestic ecommerce player said during their meeting, companies raised issues related to non-compliance with FDI policy for ecommerce by some players. 

Questions were raised about these companies having such large losses, which should not be the case if they are just tech platforms, they said. 

Also, the difference in compliance burden for companies registered in India and those servicing Indian consumers from outside creates an inequality among operators serving the same market, another participant pointed out during the meeting.

A representative of one of the multinational companies said consultative approach being taken by the government will help in drafting a comprehensive policy.

In a statement issued on Monday, the commerce ministry said these meetings are expected to dwell on multiple areas including opportunities in the growing digital economy, understanding data flows from four aspects - privacy, security, safety and free choice.

Besides, the meetings will also touch upon ownership and sharing of data, gains and costs of cross-border flow of data and mechanisms to monitor use of data, it added.

The meetings also touched upon threats to local players from large foreign competition, creation of a level-playing field, and the impact of anti-competitive practices such as predatory pricing and other discriminatory practices.

The meeting holds significance as the ministry is in the process of finalising a national ecommerce policy. Multinational firms have raised concerns over certain provisions of the draft policy.

The draft national ecommerce policy has proposed setting up a legal and technological framework for restrictions on cross-border data flow and also laid out conditions for businesses regarding collection or processing of sensitive data locally and storing it abroad.