Elon Musk-Donald Trump bromance could shape the future of digital data flows, including for India

The Biden medication had been creating argumentation abstraction to modulate Big Tech. For instance, successful 2023, US Trade Representative Katherine Tai abandoned long-standing US demands for integer commercialized rules prohibiting information localisation astatine the WTO. This aligned with India’s ambition to make a $1 trillion net system by 2030, driven by a surge successful online usage. However, Musk and different Silicon Valley companies, including Facebook, Mastercard, Visa, American Express, PayPal, Amazon, and Microsoft, are expected to person authorities backing from the caller medication successful Washington successful pushing India to little its barriers connected information flow.

During Trump’s archetypal term, disagreements implicit information localisation were a large root of friction betwixt India and the US. While India resisted altering its stance connected information localisation nether immoderate plurilateral agreements astatine the WTO, it besides tightened its norms, notably successful April 2018, erstwhile the Reserve Bank of India (RBI) mandated that outgo strategy providers specified arsenic Mastercard and Visa store outgo information for Indian residents wrong India. Despite these efforts, India’s draught e-commerce policy, which includes beardown localisation provisions, remains stalled, perchance nether US pressure.

The Data Gold Rush

Regulations connected cross-border information flows are among the astir contentious topics astatine the WTO, particularly with the emergence of Artificial Intelligence (AI). Effective AI systems — seen arsenic the cornerstone of the Fourth Industrial Revolution — necessitate divers datasets from aggregate countries. This has sparked a fierce contention for information among Silicon Valley firms, including Tesla.

Elon Musk’s negotiations with China to beforehand self-driving vehicles underscore the value of cross-border information flows. In May, pursuing extended lobbying, Musk secured Chinese support for cross-border information sharing, boosting Tesla’s stock. This information was important for processing Tesla’s self-driving technology. Notably, Musk visited China for this negotiation, skipping a planned gathering with Prime Minister Narendra Modi up of India’s wide elections.

Abhijit Das, an planetary commercialized adept and erstwhile caput of WTO Studies, said that China has altered its stance connected information flows arsenic it seeks to physique a robust AI ecosystem. “If AI is developed solely utilizing Chinese data, it volition person constricted utility. Therefore, China seeks entree to information from different countries,” helium explained.

China participates successful the WTO’s Joint Statement Initiative (JSI) connected E-Commerce, a plurilateral effort launched successful 2019 to found planetary rules for physics commerce. The JSI tackles issues specified arsenic escaped cross-border information flows and restrictions connected information localisation. Over 80 WTO members, including the US, the EU, China, and Japan, are participants.

Despite its humanities absorption connected integer sovereignty, China joined the JSI to bolster its enactment successful AI and e-commerce. However, India has opposed the JSI, choosing to stay extracurricular the inaugural and its rulemaking process. India’s home e-commerce policy, drafted successful 2019, which emphasises information localisation, has yet to beryllium finalised.

The Importance of Data Regulation for India

A 2018 UNCTAD report, ‘Power, Platforms, and Free Trade Delusion’, highlighted the value of information for innovation. It noted that power implicit information creates “market powerfulness and barriers to introduction for caller players”.

This was echoed successful a 2022–23 Standing Committee connected Finance report, which criticised Big Tech’s anti-competitive practices. It noted Google Play’s dominance arsenic the superior app root connected Android devices, its mandatory usage of its outgo strategy for paid apps and in-app purchases, and its unfair promotion of Google Pay. The study stated, “Manipulation of features connected a ascendant level whitethorn service arsenic a potent instrumentality to divert postulation to caller apps, undermining contention connected the merits.”

UNCTAD besides pointed to the benefits of information localisation, including encouraging overseas concern successful home integer infrastructure, enabling enforcement of nationalist laws, and safeguarding privateness and cyber sovereignty. Countries similar Vietnam and the Philippines person implemented specified measures to beforehand section capabilities and support babe industries.

President-elect Donald Trump and lawmakers perceive arsenic Elon Musk explains the operations up of the motorboat of the sixth trial formation of the SpaceX Starship rocket. (Photo: AP)

India’s Data Advantage

“There is important information asymmetry betwixt aboriginal commercially palmy movers and others,” said Abhijit Das. Sharing authorities information arsenic betwixt Indian and American Big Tech firms, helium argued, would not trim this disparity. However, exclusive sharing with Indian firms could assistance level the playing field, helium said.

Das noted that India has a important vantage owed to its immense idiosyncratic basal and information potential. “The occurrence of immoderate integer merchandise depends connected its idiosyncratic basal — fundamentally the information it tin leverage. India tin replicate planetary integer products and, with its information advantage, go a almighty subordinate successful the integer sector. However, robust regularisation is essential. While firms astatine the technological forefront whitethorn not necessitate regulation, India cannot spend to neglect it,” helium said.