Context: Days after India banned 59 Chinese apps for engaging in activities which are "prejudicial" to the sovereignty and integrity of the country, Beijing on Thursday urged New Delhi to immediately "correct what it called discriminatory practices" against Chinese companies. 

Issue

• India on Monday banned 59 apps with Chinese links, including the hugely popular TikTok and UC Browser, for engaging in "activities which are prejudicial to sovereignty and integrity of India, defence of India, security of state and public order". 
• Announcing its decision to ban 59 apps the Information Technology Ministry said the move will "safeguard the interests of crores of Indian mobile and internet users. This decision is a targeted move to ensure safety and sovereignty of Indian cyberspace." 
• The IT ministry statement also said that it has received many complaints from various sources, including several reports about misuse of some mobile apps available on Android and iOS platforms for "stealing and covertly transmitting users' data in an unauthorised manner to servers which have locations outside India". 

Merits of this Ban

• No Longer Reliance on Passive Diplomacy: The decision to ban these apps, which comes amid continuing tensions between India and China, is the clear message from India that it will no longer be a victim of China’s Nibble and Negotiate policy and will review the norms of engagement.
• Hurting Chinese Ambition: The ban may affect one of China’s most ambitious goals, namely to become the digital superpower of the 21st century.
• Recognising Importance of Data: India’s app ban, and consideration of related restrictions on telecom hardware and mobile handsets, is based on the recognition that data streams and digital technology are a new currency of global power.

Associated Issues

• Data Privacy Issue Not Limited to Chinese Apps: MeitY banned apps on reports of stealing and transmitting users data in an unauthorised manner to servers which have locations outside India.
• However, data privacy and data security concerns are not limited only to Chinese apps.
• Damage Done Already: The apps that were banned were very popular in India and the move to block them comes after these apps had already amassed hundreds of millions of users in India.

India’s Economic Dependencies on China: The ban on Chinese mobile apps is a relatively soft target, as India remains reliant on Chinese products in several critical and strategically sensitive sectors.

• From semiconductors and active pharmaceutical ingredients to the telecom sector, Chinese vendors are involved not only in India’s 4G network but in on-going 5G trials as well.
• Also, Chinese finance is presently essential to sustaining India’s start-up economy. As many Indian Unicorns such as Paytm, Zomato, Byju’s are having Chinese shareholders.

What is the legal basis for India’s action?

• The ban has been enforced under Section 69A of the Information Technology Act, 2000.
• It offers the power to issue directions for blocking for public access of any information through any computer resource.

This is done in the interest of -

• sovereignty and integrity of India
• defence of India, security of the State
• friendly relations with foreign States
• public order (or)
• for preventing incitement to the commission of any cognizable offence relating to above

The Ministry of Information and Technology said that it has received many complaints in this regard.

• There were reports on misuse of some mobile apps.
• There was stealing and secretly transmitting users’ data in an unauthorised manner to servers that have locations outside India.
• The notification is expected to be followed by instructions to Internet service providers to block these apps.
• Users will soon see a message saying access to the apps has been restricted on the request of the government.

How strategic is the move and how does it impact China?

• The move comes as an exercise of coercive diplomacy with China amid the tense standoff in Ladakh.
• The decision has been taken in a specific strategic and national security context.
• So, it could be a warning to bigger Chinese businesses in India, and to China itself.
• However, the government has, for now, picked up a low-denomination item - mobile apps.
• This has only a limited impact on Indian businesses.
• But it has a disproportionately large presence in the mass consumer segment.
• This may not hurt India given the alternatives in the app space. But for China, the Indian app market is growing and valuable.
• More so because internet costs here are one of the lowest in the world, and consumers number over 800 million.
• Nearly half of these smartphone users are below 25 and hungry for content on their devices.
• A decision at stopping physical goods could have been challenged by China at the WTO. Instead, this move focuses on the technology sector.
• A ban on physical goods would have also adversely affected India’s business and economy while hardly making a dent on China’s.
• The move is thus being seen as one that could be more effective from New Delhi’s perspective.

Strengthening Data Security Architecture

• Weeding Out Obsolete Legislations: India’s digital applications are governed by obsolete laws, which is unsuitable in the context of today’s digital scenario.
• Information Technology Act, 2000 (20-year-old law) was designed for the business process outsourcing ecosystem, not for modern digital applications or platforms.
• Similarly, the Copyright Act, which provides incentives and protections for most of the content that sits at the heart of the digital economy, was last amended in 2012.
• Thus, there is a strong case to revise the key legislations and syncing them to change the digital environment.
• Need For A Data Protection Law: Data privacy and security remains to be major challenges emanating from the ongoing digital revolution. Thus, a data protection law is long overdue.
• In this context, the Indian parliament must expedite the enacting of the Personal Data Protection (PDP) Bill, 2019.
• Need For Developing Alternatives: The ban initiated by the Indian government for securing citizen’s data is nothing new.
• Similar moves have been taken by China, as mobile apps like Whatsapp, Facebook have been banned in China for years. However, the Chinese government was quick to provide the local alternative to its billions of users.
• Even today, these equivalent Chinese services like WeChat, Weibo pose a decent competition to established global digital players.
• Thus, the recent ban is a good opportunity for Indian entrepreneurs to quickly rise to fill market gaps.

Road Ahead

• World today recognises that the next source of economic growth lies in the digital economy and given its raw material being data, thereby whoever decides standards and builds the electronic backbone will have enormous advantages over everyone else.
• Thus, India must speed up indigenisation, research and development and frame-up a regulatory architecture to claim data sovereignty.