[Answered] There have been continuous efforts to regulate the physical infrastructure that forms the backbone of Digital India. Bring out the implications of steps toward regulating the digital ecosystem.

Introduction: Contextual introduction.
Body: Write some implications of steps toward regulating the digital ecosystem.
Conclusion: Write a way forward.

While tech giants like Google, Facebook, Amazon etc. have undoubtedly contributed to the creation of a wide range of innovative and efficient products and services, their business models have also given rise to complex and interconnected policy issues. So, some steps are taken toward regulating the digital ecosystem to exercise more control and a preference for domestic firms while limiting the influence and dominance of Big Tech.

Implications:

  • Threat to freedom: These tech giants provide Freedom of Expression to individual and also made billions of people to depend on their services. Like, Google on the internet, Amazon on e-commerce etc.
  • Controlling data flow: The proposed data localisation norms would provide greater control over cross-border data flows.
  • Compliance burden: Increasing data storage requirements and imposing strict restrictions would only increase the compliance burden of Big Tech.
  • Benefits few: These steps seek to tilt the balance of power rather than create a level playing field. And only a few domestic players stand to benefit the most. E.g. even domestic players like Tata and Reliance would find it difficult to integrate multiple brands and sell their products through super apps.
  • Legal challenges overburden Judiciary: The enforcement of many of these norms is bound to spur extended legal fights. This will overburden the Judiciary.
  • Impact on growth and job creation: The new e-commerce rules create over-regulation, along with a scope for interpretative ambiguity in rules. This will retard growth and job creation in the hitherto expanding e-commerce sector.
  • This form of industrial policy which favours a few chosen domestic players while restricting foreign competition could lead inefficient and uncompetitive goods and services market.
  • If the concern is expansion of the foreign firms in IndiaCompanies of Indian origin could be acquired by a foreign company or that receives funding from Big Tech.

Way forward:

  • Introduce a ‘Green Channel’ to enable fast-paced regulatory approvals for the vast majority of mergers and acquisitions that have no concerns regarding adverse effects on competition.
  • Open CCI offices at the regional level to carry out non-adjudicatory functions and interaction with State Governments in controlling the Big Techs.
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