An attempt at tilting the balance of power: How the government is trying to control Big Tech

How rationale are the justifications given Source: The post is based on an article “An attempt at tilting the balance of power: How the government is trying to control Big Tech” published in The Indian Express on 15^th October 2022.

Syllabus: GS 2 – Governance

Relevance: issues with the government policies in the digital sector

Context:  There has been attempts by the government to regulate each and every aspect of India’s digital ecosystem.

This is evident from the proposed draft telecom bill, the personal data protection bill, etc. that require to regulate the physical infrastructure that forms the backbone of Digital India.

What are the aims of the government behind the regulation in digital sector?

First, Government’s efforts are pointing towards localisation and giving preferences to domestic firms. It is bringing laws that promote them and limit the influence and dominance of Big Tech.

For example, the draft telecom bill. It proposes to bring OTT communication platforms under it by providing similar rules like those governing the telecom operators.

Second, as per the government, it is trying to create a level playing field and address the concerns of national security.

However, majority of the initiatives by the government are aimed at curbing the dominance of Big Tech instead of any economic logic.

by the government?

The current policy differentiates between the domestic companies and foreign companies, only in the digital sector.

If market concentration restricts competition, then the same argument should be extended to telecom operators. For example, ownership of spectrum is limited to few firms only.

The provisions of different bills seem to increase the controlling power of the government rather than create a level playing field.

This form of industrial policy which favours a few chosen domestic players while restricting foreign competition could lead inefficient and uncompetitive goods and services market.

This would also go against the government’s aim of the digital economy.

If the concern is expansion of the foreign firms in India. Companies of Indian origin could be acquired by a foreign company or that receives funding from Big Tech.