The foreign-domestic divide

After years of debate, the focus is back on Indian sensibilities - whether it's about having local data or servers in India or having a differential e-com policy

Flipkart co-founder Sachin Bansal made a point recently about lack of trust between entrepreneurs and bureaucrats in the power corridors of New Delhi. But that’s only a part of the big story that suggests a disconnect between the government machinery (not only in the current regime) and businesses. More so when the business involved is a foreign entity. And much more so when the business is a successful foreign start-up.

To think of it, it’s a love-hate relationship. Meetings with celebrity founders and chief executives are photo-ops that who’s who of the government seldom want to miss out on. And, Silicon Valley corner offices are often on the itineraries of the people who matter in the government. But when it comes to doing business in India, an opposite emotion guides the policy-makers.

The most recent example is WhatsApp CEO Chris Daniels' visit to India. In a series of notices and warnings, the Ministry of Information Technology told the California-based company, owned by Facebook, that it must stop the spread of fake news or be ready to face action. In a desperate attempt to douse fire, Daniels flew down to meet Union Minister of Electronics and Information Technology Ravi Shankar Prasad. Daniels kept quiet after his interaction with the minister, who later briefed the press about the government demand and the promises made by WhatsApp. After a prolonged face-off, it’s not clear yet on how exactly WhatsApp would trace the origin of a ‘’sinister message’’ and prevent fake news from spreading. The American company, with more than 250 million active subscribers in India, has maintained so far that it does not want to risk the privacy of WhatsApp by offering traceability of messages. Will that change?  

   

Not too long ago, Facebook and its CEO Mark Zuckerberg got a warning from the government over any attempt by the social media group to influence the electoral process of the country through undesirable means. At the centre of controversy was Cambridge Analytica, which was accused of sourcing data from Facebook for voter research during the US elections. Both the Bharatiya Janata Party and the Congress gave it a national colour by alleging that the other was using the services of Cambridge Analytica for various polls. Needless to say both denied the allegations, while the government issued a warning to Zuckerberg. 

Even Apple Inc has been locked in a tussle with the Telecom Regulatory Authority of India (Trai) over  unsolicited calls and messages on iPhone. Apple refused to provide a solution that could curb pesky calls on iPhone, citing privacy issues. Recently, the Cupertino-based company told the government there would be a mechanism in the new operating system to report unsolicited calls and messages. It’s a project in the works. 

But that’s not the only face-off for Steve Jobs-founded Apple in India. It failed to set up own stores in India as it could not comply with the 30 per cent sourcing norms linked to Foreign Direct Investment in single brand retail. Apple told the government, compliance wasn’t feasible as there was nothing much to source from India. Despite much back and forth on guidelines for niche products like iPhone, the issue has dragged on for several years with no solution.

The case of Canadian handset maker Blackberry is well known too. The long-drawn controversy that played out during the UPA regime prompted co-founder Mike Lazaridis to say that the company was being unfairly singled out. The issue surfaced in 2008, a time when local data storage and India server were still not a part of the popular narrative. The government wanted Blackberry, the preferred device then for the elite, to locate its servers in India so that the emails and messages could be traced. After fighting for years, the company came out with a solution to let the authorities have “lawful access’’ to consumer messaging services including the BBM messenger service. However, its enterprise service  continued to remain out of bounds for the authorities wanting to trace messages.

Way back in 2001 during the previous NDA rule under Atal Bihari Vajpayee, FTV came under the scanner when the TV channel’s content was found “objectionable” by a consultative committee. After series of show-cause notices, FTV founder Michael Adam had to come down from France to meet the then information and broadcasting minister Sushma Swaraj. Subsequently, instructions were given out to dress up the models in the fashion channel suitably so that Indian sensibilities were not hurt. Not sure for how long the censorship worked in the French channel for the Indian audience though.  

Some 17 years later, the focus is back on Indian sensibilities — whether it’s about having local data and servers or having an e-commerce policy that differentiates between domestic and foreign.