India’s face-off with Big Tech will intensify in 2023

BY MEGHA MANDAVIA | UPDATED JAN 04, 2023 12:15 AM EST

American tech firms will face hard choices in India this year

The standoff between India and U.S. tech giants will intensify in 2023 as New Delhi cooks up its own regulatory medicine for the world’s second most populous internet market—an unusual concoction of Europe’s strict antitrust approach and Chinese-style government surveillance.

Three significant pieces of legislation likely to pass in 2023 will harden positions on both sides.

In late December, an Indian parliamentary panel recommended the government pass a digital competition act regulating alleged anticompetitive practices by top tech players. The panel proposed forbidding platforms from preferentially promoting their own in-house brands or locking out third-party payment systems, as well as banning practices like forced deep discounting and exclusive tie-ups. Such steps would bring India in line with the European Union, notes Sarvada Legal, a law firm specializing in competition law.

New Delhi is also planning a new telecom law that would tighten the government’s grip on internet firms and boost its capacity for surveillance.The law would replace many archaic statutes, one of which dates back to British India in 1885. But it also emulates the old colonial obsession with control.The draft proposes licenses for everything from WhatsApp to Gmailand weakens privacy rights with onerous know-your-customer requirements.

And while Big Tech largely supports the latest draft of India’s pending data protection bill—thanks mostly to less onerous data localization requirements—it has been called Orwellian by the retired judge who chaired the committee that drafted the original version.

India will probably see more explicit resistance from American Big Tech this year given what’s at stake: Silicon Valley’s dominant position in India’s rapidly growing digital economy and the politically perilous possibility of being drafted as a foot soldier in a more muscular Indian surveillance state. What would be particularly worrying for tech giants like Meta and Alphabet is if India’s unique approach becomes a blueprint for other large emerging internet markets.

It’s no wonder then that in late December, Google unveiled its decision to appeal against the antitrust watchdog’s decision to fine it $162 million for allegedly abusing its dominant position in Android. Salman Waris, partner at TechLegis, a tech-focused law firm in New Delhi, believes that more pushback like that is coming—both lobbying to influence the language of new laws and also in the courts. Penalties and fines imposed on Big Tech are likely to be aggressively challenged.

With 780 million users according to Redseer Strategy Consultants, India is home to the second-largest internet user base in the world—equal to more than two times the population of the U.S. That is expected to surpass one billion by 2030, helped by accelerating smartphone adoption. The Indian government knows this and will use it as bait to dilute resistance to tough laws.

New Delhi and Silicon Valley are squaring up for a battle among equals in 2023.

This story has been published from a wire agency feed without modifications to the text.