Editorial 1: How to govern data
Recent Context:
- Rajya Sabha “unanimously” passed the Digital Personal Data Protection Bill (DPDP),2023 with mixed reactions. The provisions of the bill are criticised for allowing state outside the ambient of the act which compromise the privacy of personal data.
Significant provisions of the bill that are facing criticism
- As, one of the goals of the legislation is to strike a balance between protecting personal data and enabling the processing of such data for lawful purposes, so as to enable innovation and promote economic growth.
- In doing so, the government has largely exempted itself from the purview of the law, in letter and spirit.
- The Act declares that for the “security of the state, maintenance of public order or preventing incitement to any cognisable offence relating to any of these, and the processing by the central government of any personal data that such instrumentality may furnish to it”, the state falls outside its scope.
- In other words, the state could, in theory, invoke national security to justify any action
- The Act also provides that the central government notify a Significant Data Fiduciary (SDF), and impose obligations on it, including periodic audits and data protection impact assessments, among others.
- While notifying such SDFs, the government will consider the volume and sensitivity of personal data processed, risks to the rights of the data principal (the individual who owns the data), the potential impact on the sovereignty and integrity of India, risks to electoral democracy, security of the state, and public order.
- The Act also empowers the government to exempt any private entity from additional obligations imposed on SDFs. This leaves room open for arbitrariness and regulatory asymmetry
- Finally, the Act mandates the establishment of an adjudicatory body, Data Protection Board (DPB), that will enjoy quasi-judicial powers and will be wholly appointed by the central government.
Ambiguous words within the bill which may lead to misuse of personal data
- Prima facie Significant Data Fiduciary (SDFs) are most likely to be entities that enjoy “significant market power” (SMP) and as such possess the means to abuse their dominance.
- If it is compared with competition policy that relies heavily on SMP analysis, notification of the SMP is the privilege of the regulator because it has the necessary expertise to do so.
- Moreover, competition policy is no longer concerned with size and structure, but with conduct. As a result, competition law in India continues to be largely ex-post implying that the market regulator, the Competition Commission of India (CCI) intervenes once market distortion has occurred.
- Through this legislation, the government has signalled an intent to lay down ex ante rules to keep a check on the power enjoyed by certain platforms that exercise immense influence. There is nothing wrong with that, except the task ought to be delegated to the DPB
- If designed well, ex ante regulation could help in:
- Acknowledging and possibly limiting the harms that digital behemoths have the potential to unleash; and
- ensuring that the burden of onerous obligations does not create high entry barriers for start-ups seeking to disrupt the behemoths, Schumpeterian style.
Telecom Dispute Settlement and Appellate Tribunal (TDSAT) as the appellate tribunal of DPB
- Another aspect of the law that seems odd is designating the Telecom Dispute Settlement and Appellate Tribunal (TDSAT) as the appellate tribunal of DPB.
- TDSAT was established with a view to hear appeals against orders of the Telecom Regulatory Authority of India (TRAI). Data is vastly more than just telecom and arguably more complex.
- Telecom disputes have over time themselves become more intricate and time consuming to resolve
- It will be hard to define jurisdictional boundaries between TRAI and TDSAT
- It could well be argued that TDSAT was unable to function along Benthamite lines for the welfare of the majority and it is unlikely to do so under the current structure to enable protection of personal data.
Conclusion
- Repurposing an existing institution to deal with ever more complex questions posed by new and emerging technology is a brave experiment.
- Data governance is serious business and if the government is serious about it, then it needs to delegate, in letter and spirit.
Editorial 2: Minding the Research Gap
Recent Context:
- Recently, Parliament passed the Anusandhan National Research Foundation (ANRF-2023) Bill.
- It aims to provide
- “high-level strategic direction for research, innovation and entrepreneurship”, and
- enhance “India’s national research infrastructure, knowledge enterprise, and innovation potential, for scientific pursuit”
The key mission under NRF:
- Broadly, the NRF has three key missions:
- One, capacity building at universities and colleges;
- two, growing and nurturing excellence in cutting-edge research across disciplines;
- three, supporting research for societal impact.
- These missions will require not just substantial monetary investment but also the trained human resources to enable the optimal use of monetary resources, and an efficient and flexible governance model.
The challenges face by publicly-funded research ecosystem
- The publicly-funded research ecosystem fights battles on two fronts.
- The first is inadequate funding, and
- the second, the inflexible rules and regulations.
- Gross expenditure on R&D (GERD) at 2 per cent of GDP is recognised as the ideal benchmark to maintain a competitive advantage, though Israel, South Korea, the US, Germany and a few other nations invest more than 3 per cent annually. In contrast, India’s GERD stagnated at about 0.7 per cent of GDP in the last two decades.
ANRF is expected to increase investment in research through private participation
- Once ANRF is created, the government intends to invest Rs 50,000 crore in the next five years.
- Unless this adds to the budget allocation for the science and technology ministry, Rs 16,361 crore in 2023, effective funding will decline sharply. Even if added together, GERD will not touch the 2 per cent benchmark
- Therefore, to bridge this gap, the ANRF-2023 Bill plans to seek significant private sector contributions. In the US and UK, more than 50 per cent of GERD comes from industry, whereas in India it stands at 35 per cent.
- This is an opportunity for synergy with the industry, but there are challenges. Though the Corporate Social Responsibility (CSR) rules allow contributions towards scientific research, they can only support projects for up to one year.
- The CSR mode might be viable if rules can be amended to raise a corpus and allow a 3–5-year rollover of funds committed for research purposes. Rules apart, the idea that private sources can fund basic and applied research through CSR or endowments awaits broader acceptance in India
It will promote ease of doing research
- For decades, scientists have complained about the bureaucratic labyrinth and its impact on the research environment.
- The Science, Technology, and Innovation Policy 2020 (STIP-2020) has flagged this issue by proposing to measure if “the research activities are adequately funded, are less bureaucratic and accountability is in both directions, the donor and the receiver”.
- The central issue is about timely allocation and flexibility to utilise grants. The STIP-2020 does recognise that “General Financial Rules will be required to be amended for funding of R&D projects to facilitate ease of doing research
- The introduced bill is result in timely allocation of funds for doing the research and also in inclusive manner.
Conclusion
- While Addressing the Indian Science Congress, Prime Minister Narendra Modi said “scientists and researchers to explore the mysteries of science and not of government procedures… application requirements for scientific projects should not be more complex than research”
- Therefore, the administrative structures under ANRF must help recalibrate practices and attitudes to capitalise on India’s research potential.