This comprehensive policy draft, likely to increase operating costs for this sector, took place two months after the country adjusted regulations governing foreign direct investment into e-commerce.
This forces Walmart-owned giants such as Amazon and Flipkart to restructure their operations in India and new regulatory changes will fundamentally change this field.
“In the future, economic activity may be based on data. Therefore, it is important that we retain data control to ensure job creation in India, ”the policy draft document said.
The new regulations require the placement of multiple data centers and servers locally, in the context of this South Asian country as one of the fastest growing online markets in the world.
India's central bank in 2018 has forced payment providers such as Mastercard and Visa to store Indian users' data in the country.
The draft policy also stated: "Steps will be taken to develop data storage capabilities in India. The e-commerce sector will have 3 years to make adjustments to data storage requirements ”.
The proposed regulations also seek to create a legal and technological framework, to impose restrictions on user-generated cross-border data flows. These moves can affect not only e-commerce platforms but also social media companies like Google and Facebook.
The new draft regulation also forces all e-commerce companies to provide access to their data stored abroad whenever there is a formal request. This draft comes at a time when India is implementing a broader data security law, and prohibits companies from sharing data stored abroad with other businesses even with consent. of the user.
Other proposals include obliging all e-commerce websites or applications operating in India to have a locally registered business entity and increasing the responsibility of those involved in e-commerce to ensure Products sold on their platforms are not counterfeited or pirated.
It is expected that the draft will be consulted on March 9, after which regulations can be formalized.

Source: Summary