India is not in a position to accept the concept of Data Free Flow with Trust (DFFT) as it is neither well understood nor is comprehensive enough in the legislation of many countries, Commerce and Industry Minister Piyush Goyal said. In view of the huge digital divide among countries, there is a need for policy space for developing countries which still have to finalise laws around digital trade and data. The minister was speaking at the virtual meeting of the G-20 Trade and Investment Ministers.
  1. DFFT was originally proposed by former Japanese prime minister Shinzo Abe at the G20 summit last year.
  2. Like many other developing countries, India is still in the phase of preparing a framework for its data protection and e-commerce laws.
  3. The existing regulations on which DFFT is sought to be premised, such as uninhibited cross border flow of data, are grossly inadequate to address our concerns on data access. The minister added that this could further aggravate the digital divide.
  4. India, along with some other G-20 members, did not participate in the Osaka track last year due to its reservations. India is not in a position to accept the concept of DFFT.
  5. Reforms must preserve fundamental principles like non-discrimination, inclusiveness, recognition of special and differential treatment, and consensus based decision making.
  6. India must recognise that WTO (World Trade Organisation) is a member led organisation, and the G-20 must not seem to be intrusive and driving the agenda for the multilateral trading system.
  7. Further, it is important to recognise the important role of small retailers in sustaining food chains and essential supplies to help sustain lives and economic activity through the COVID-19 pandemic and in future.
  1. Powered by data flows, digitalization has become crucial for the seamless functioning of economies and societies. 
  2. Countries, however, can have concerns that once data moves abroad it will not be treated the same as at home. 
  3. Jurisdictions do not trust each other to act appropriately on data governance. 
  4. Motivated by objectives such as privacy, security, access to data, and industrial policy, national regulations often restrict the cross-border movement of data, resulting in fragmented and sometimes contradictory rules.
  5. A major international initiative on data flows, the Osaka Track, was launched by heads of governments under Japan’s G20 leadership in 2019
  6. This paper develops a framework for ‘data free flow with trust’ – the key underlying concept of the Osaka Track
  7. It maps a multi-dimensional architecture for international cooperation on data flows, between governments, as well as involving business, with recommendations to increase levels of governance trust and build openness through trade rules and other tools.