In a sign of resistance against developed countries led by the US and Japan, which are pushing for free flow of data across borders, India Friday refused to become a signatory to the Osaka declaration on digital economy that was signed by 24 countries and groupings.
While a majority of G-20 countries signed off on the launch of “Osaka track”, an overarching framework promoting cross-border data flow with enhanced protections launched by Japan Prime Minister Shinzo Abe, India was joined by South Africa and Indonesia in keeping away.
Seated between US President Donald Trump and Chinese President Xi Jinping at a meeting on digital economy, Abe underscored the importance of his “Data Free Flow with Trust” concept — a move spearheaded by Japan that calls for the creation of international rules enabling free movement of data across borders.
India is hedging its bets
As trade wars roil global markets, the Osaka move on data signals that digital economy matters now to world leaders at the geopolitical level. Still building a framework to harness its data economy potential, India is hedging its bets on the issue. Even if it means breaking ranks with strategic partners — the US and Japan.
The issue of data for development was flagged by India at the BRICS leaders’ meeting Friday, which Foreign Secretary Vijay Gokhale said had emerged as a “major issue” in international rule-making.
Explained: Why the world is debating data flow
Gokhale, who briefed reporters after the BRICS meeting, said India believes that the discussions and negotiations pertaining to data should be held within the context of the World Trade Organisation (WTO). “Data is a new form of wealth,” the Foreign Secretary said, adding that the WTO is framing international rules on this issue.
Sources said this issue has become a major point of discord between major developed countries in the G-20 on one side, and India and China on the other side.
India’s position was articulated at the recent G-20 ministerial meeting in Tsukuba city in Japan on June 8 and 9, when Commerce Minister Piyush Goyal conveyed India’s concerns over playing catch-up in this technological frontier. “We believe all nations should appreciate that the digital divide within and across nations is a serious impediment for developing countries to benefit from Digital Trade. Capacity constraints in developing countries, can be overcome with timely support of training and creation of digital infrastructure. This is important for facilitating a level playing field in the digital economy for all countries to take equitable advantage of data free flow,” he had said.
The Osaka initiative, introduced in a speech at this year’s World Economic Forum and one of Abe’s pet projects at the G20, seeks to standardise rules in global movement of data flows with better protection in personal information, intellectual property and cybersecurity.
Abe said digitally driven economies can spark innovation and encourage economic growth. But in order to do so, there needs to be a reliable set of rules for the free flow of data.
Trump lent his support to Abe’s plan, saying the free flow of data is an integral part of the American digital economy’s success, along with strong privacy and intellectual property protections, and access to capital and innovation.
“The digital economy is a crucial driver of economic growth. At the same time, as we expand digital trade, we must also ensure the resilience and security of our 5G networks,” Trump said, taking a subtle dig at Chinese telecommunications giant Huawei. “This is essential to our shared safety and prosperity.”
But Xi defended China’s policy. “Effective governance should promote collecting, analyzing and applying data, and all of the countries must individually manage data with order,” he said.
Although Abe had initially hoped to highlight the digital push at the G20 summit, it was later downgraded to a secondary event. The decision was made to avoid ostracizing countries still on the fence, a senior Japanese government official was quoted as saying by Japan Times.