By Divij Joshi

The Draft National E-Commerce Policy is an ambitious document – in the course of 42 pages, it aims to guide not only the future of India’s e-commerce sector, but the entirety of its digital economy.

Unfortunately, this ambition is also its downfall – the policy’s articulation of principles governing the future of the Indian internet are vague, and its proposals for the regulation and governance of the internet are at variance with the lofty ideals of data sovereignty for Indians.

The draft policy must be read in its immediate context – specifically, ongoing global trade negotiations where India and some other developing nations are hoping to overturn what they view as a systemic unfairness in the global digital value chain. The e-commerce policy is meant to signal that India is serious about its aspirations to reserve its political control over the internet. The aspirations of social and political sovereignty over a community resource like the internet are laudable, and indeed, it is high time we seriously consider how to make the gains from the global digital economy more equitable.

However, apart from asserting India’s claim over data and e-commerce, the policy does little to provide any guidance on how to enable a vision for data sovereignty.

The policy is so vague in its scope that it does not even provide a functional definition of the very aspect it wants to cover – there is no clarity on what is conveyed by the term ‘e-commerce’, nor by the wider term of the ‘digital economy’.

Stemming from this lack of clarity, the policy meanders between issues of intermediary liability and the protection of intellectual property rights; governance of AI and algorithms; ex-im regulation; content liability for platforms; FDI in e-commerce; data localisation and even environmental sustainability, among others.

In doing so, it barely scrapes the surface of many of these issues and fails to provide a meaningful basis for many of its suggestions, many of which are potentially antithetical to its vision of ‘data sovereignty’ and fairness towards digital consumers and entrepreneurs.

For example, the discussion over asserting ‘data sovereignty’ and using data for the public good stops at suggesting restrictions on cross-border flow of data and implementing data localisation, without any analysis on whether this is a necessary or sufficient condition for enabling data to be utilised by the government or by private entities, or any further insight into enabling trusted data sharing mechanisms for public use, such as building improved internal open data systems and standards.

Similarly, the draft policy discusses transparency and fairness of online marketplaces towards vendors, however, its proposals, for no apparent reason, limit such requirements to marketplaces with FDI. Other concerning proposals include the creation of a private ‘industry’ mechanism to remove online websites accused of hosting ‘pirated content’, without any independent or judicial review.

Contrast this draft with policy-making in the EU, which is being systematically and comprehensively developed, whether on the regulation of online platforms or the crucial issue of competition in the digital environment, an issue which this draft policy almost entirely ignores.

Such half-baked regulatory proposals are symptomatic of the draft policy’s inability to provide a consistent vision for governing either India’s e-commerce or its digital economy. It must go back to the drawing board.


About the author: Divij Joshi is a lawyer who tinkers in technology policy. He is presently a research fellow at the Vidhi Centre for Legal Policy, Karnataka, where he works on legal reforms in state and local government.

The author has written this article on MediaNama’s invitation.