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Economic Impact: ‘India lost $2.8 bn in 2020 to Internet shutdowns; over double of 20 others’

Of the 21 countries that curbed Web access last year, as per a report by the UK-based privacy and security research firm Top10VPN, the economic impact seen in India was more than double the combined cost for the next 20 countries in the list.

Written by Pranav Mukul | New Delhi |
Updated: January 6, 2021 7:28:21 am
While the economic impact due to Internet curbs surged in India in 2020, globally, at $4.01 billion, this came down by 50 per cent from 2019.

India suffered the biggest economic impact in the world in 2020 due to Internet shutdowns, adding up to 8,927 hours and $2.8 billion losses. Of the 21 countries that curbed Web access last year, as per a report by the UK-based privacy and security research firm Top10VPN, the economic impact seen in India was more than double the combined cost for the next 20 countries in the list.

The report added that the actual economic impact for India may be even higher than the $2.8 billion figure — which itself was double the losses on account of Internet shutdowns in 2019, with businesses in 2020 anyway hit due to the Covid lockdown. “As in previous years, India continued to restrict Internet access more than any other country — over 75 times in 2020. The majority of these short blackouts were highly targeted, affecting groups of villages or individual city districts, and so were not included in this report, which focuses on larger region-wide shutdowns,” it said.

A costly exercise

With increasing dependence on the Internet, especially in the aftermath of the Covid pandemic, shutting of services even in small regions hits access to services such as payments, healthcare, commerce, education, etc -- adding up to economic losses.

The report made a separate mention of the extended curbs on Internet use in Kashmir, with suspension of services lasting from August 2019 — when J&K’s special status was scrapped — to March 2020, and still remaining severely throttled, with only 2G access available. Calling it “the longest Internet shutdown in a democracy”, the report says, “The restrictions have negatively impacted the distribution of medicine, businesses and schools.” According to the latest Telecom Regulatory Authority of India data, as of October 31, there were 11.70 million wireless subscribers in the J&K circle.

While the economic impact due to Internet curbs surged in India in 2020, globally, at $4.01 billion, this came down by 50 per cent from 2019.

As per the report, the world saw 93 major shutdowns during the pandemic-stricken year. Apart from India, the report features Belarus, Myanmar, Yemen, Ethiopia, Azerbaijan, Turkey, Syria, Iran, Tanzania, Venezuela and Somalia. Countries such as China and North Korea, which are known to restrict access to the Internet, are not in the list prepared by Top10VPN.

To calculate the economic cost of Internet shutdowns, the firm used the “Cost of Shutdown Tool” from Netblocks and Internet Society, which uses the Brookings Institution Method. Regional shutdown costs were calculated by determining the region’s economic output as a proportion of its national gross domestic product.

The report defines an Internet shutdown as “an intentional disruption of Internet or electronic communications, rendering them inaccessible or effectively unusable, for a specific population or within a location, often to exert control over the flow of information”.

An e-mail query sent to the Ministry of Electronics and Information Technology had not elicited a response at the time of going to press.

While restrictions in J&K accounted for the highest share of Internet blackouts in the country, localised shutdowns were seen in regions in Arunachal Pradesh, including Lower Subansiri, Upper Subansiri, Lower Dibang Valley, Lohit, Tirap, Changlang, Itanagar Capital Region, Papum Pare, Tawang, East Kameng, West Kameng, East Siang, West Siang, Leparada and Upper Siang, in November, and in several regions of Meghalaya in February.

“Dependence on the Internet has increased and, therefore, when a shutdown happens, access to a number of essential services is restricted … There was a six-day-long ban in Hooghly near Kolkata in May, and this was when the pandemic was at its peak. People lost employment, lawyers could not attend hearings, people who depended on online pharma stores could not order medicines and there were students who couldn’t attend online classes… Also, there is no solid methodology for calculating the full impact of an Internet shutdown, because in India, the shutdowns are hyper-localised,” said Prasanth Sugathan, legal director at SFLC.in.

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