Let’s leverage the EU-India trade and technology council to gain market access and align policy on genuinely common values
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On 25 April, India and the European Union (EU) issued a joint press release on the launch of an EU- India Trade and Technology Council. Broadly, the Council is geared towards helping intensify cooperation between both jurisdictions on issues that lie at the intersection of trade, trusted technology and security. It is a welcome pact, as it may engender avenues for greater market access for Indian technology companies in the EU. It may also prompt the percolation of European values into Indian rule-making on technology. For instance, a greater emphasis on ethics in emerging technology is highly desirable.
However, in a bid to find some middle-ground with Europeans on rule-making, India must not follow their playbook blindly. While placing values at the centre of law-making is important, the devil lies in the details. The way that Europeans have operationalized their core values in technology policy could work to the detriment of Indian businesses.
Take, for example, the important value of individual privacy and its realization in the EU’s General Data Protection Regulation (GDPR). The GDPR places data subjects (or users) at the centre of its focus. Its core provisions, which include processing data for an expressly-stated purpose and restricting the collection of data to the extent of fulfilling such a purpose, rely on user consent to function. Theoretically, a consent-based framework prioritizes a user’s well-being, and is based on prevalent practices in medical ethics. However, in reality, it inconveniences users while not necessarily leaving them more empowered. It simultaneously increases the compliance burden on technology businesses.
A 2019 study found that the GDPR prompted high rates of fatigue among European users over consent notices and encouraged the rise of digital applications to block such banners. Indeed, the same study concludes that users are so fed up with privacy notices that, given a binary choice, they would prefer an application tracking them over having to separately sanction the use of data tracking software by individual companies.
Closer home, the operation of the Indian Personal Data Protection Bill, broadly modelled on the GDPR, has been unsurprisingly mired in controversy. The GDPR is undoubtedly an exemplary attempt at rule-making because it is the first framework of its kind to place emphasis on individual privacy online. However, it is a complex law that represents the lowest common denominator between 27 countries. There was already supposed to be a GDPR 2.0 in the works. However, this is proving a complicated task even for a continent adept at rule-making. India is better off with a nimbler approach to digital governance that targets specific harms, rather than catch-all frameworks.
Another value that lies at the heart of EU technology regulation is fair competition. Ursula von der Leyen, president of the European Commission, even clubbed it alongside foundational values such as democracy in her speech at this year’s Raisina Dialogue. However, when the ideal of fair competition is put into practice by the EU, it is anti-scale. Historically, European competition policy has focused on placing restrictions on firms in dominant market positions. These restrictions usually involve prohibiting such entities from engaging in business conduct that may “hinder or distort competition". Thus, business strategies that would be perfectly legal in the context of a small firm are rendered illegal when carried out by a large one.
The EU’s newly-adopted Digital Markets Act (DMA) illustrates the anti-bigness sentiment of European competition regulation. This piece of legislation primarily targets large technology companies in a bid to support the aspirations of smaller businesses and developers. The DMA seeks to regulate “the gatekeeper power of the largest internet companies" by placing requirements of inter- operability and data sharing on them.
The EU has weaponized the important value of fair competition towards narrow and protectionist ends. This approach is inconsistent and myopic. For instance, the EU does not have any large social media platforms like Facebook or Twitter of its own, and is therefore discussing a potential mandate for such companies to be interoperable with each other. Such measures seek to weaken the position of US tech majors in Europe, in what is essentially industrial policy operating under the garb of fair competition. Similar approaches could just as easily target Indian digital products that seek access to EU markets in the future. Moreover, it is hard to contemplate how interoperability would function in a more decentralized internet, which is likely to spawn innumerable metaverses, and where India, with it’s software-engineering prowess, is likely to have an edge over Europe.
India’s interests therefore lie in leveraging the EU-India Trade and Technology Council towards two specific ends. The first is to ensure that our businesses are able to navigate an under-penetrated European market, which currently accounts for only around 15% of Indian software services exports. The second is to ensure that we reaffirm our commitment to common values, while ensuring that their application is not repurposed into trade barriers. This is perhaps easiest to do in the context of emerging technologies like artificial intelligence, where the EU is an uncontested thought-leader. We must take the best that Europe has to offer, while filtering out all hypocrisy.
These are the authors’ personal views.
Meghna Bal and Vivan Sharan are technology policy experts associated with the Esya Centre, New Delhi