Why Are EU’s Data Privacy Norms Worrying Indian Tech Companies?

Indian companies have always benefited from those working in the European Union (EU), but with newer norms, the prospects could shrivel pretty soon.


Post the Debt Crises that swept throughout Europe, the countries are stabilizing and the companies there have begun to show signs of revival. However, increasingly stringent data protection regulations in the region, especially pertaining to the trans-border data flows, could negatively impact Indian IT-ITeS industry, cautioned the Industrial Secretarial Body; NASSCOM. Considering that Europe accounts for close to 20% of the Indian IT export and the current valuation of the industries lies somewhere in the vicinity of US$ 110 Billion, such policies could prove severely detrimental.

Why are Indian tech companies concerned with EU’s policies about citizen data privacy? Europe is by far the strictest group of countries when it comes to protecting private data about its citizens. The ‘EU Data Protection Directive’ which governs trans-border data flows and lays down conditions for transferring of personal data of EU citizens outside the region, is highly restrictive. It mandates strict norms over the core flow of the data related to its citizens to foreign countries.

In the past, the EU has dealt with such issues with an iron hand and though India considers itself worthy of being conferred with the title of a ‘Data Secure’ Country, it is by far one of the most vulnerable one to attacks as has become apparent on multiple occasions.

Fortunately, NASSCOM and Data Security Council of India (DSCI), along with Department of Commerce (DoC) and Department of Electronics & Information Technology (DeitY), have been working on the trans-border data flow issue between EU and India for quite some time and the team members are hopeful of striking a reasonable balance between easier data-flow and maintenance of adequate data security and integrity.

Legal instruments meant to safeguard data, coupled with the enforcement mechanisms across member countries, put too much obligations on businesses. Hence they are often considered as unfriendly to businesses, especially small and medium-sized service providers. Will NASSCOM be able to convince the EU to change its stance for India?


Image Source | nttcom

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