Analysis: Data Protection in India - Getting It Right

The blog post by Suparna Goswami and Varun Haran was published by Info Risk Today on April 26, 2017. Pranesh Prakash was quoted.

The government of India recently informed the Supreme Court of India that it expects to put in place a comprehensive data protection framework by October. The Telecom Regulatory Authority of India will be heading up the initiative and has already started consultations for preparing a draft framework.

The government on April 5 acknowledged that there was no proper regulatory framework to deal with privacy concerns of citizens arising out of "over-the-top" popular messaging services such as Whatsapp, Facebook and Skype. Consequently, the Department of Telecommunications is exploring creating a "regulatory framework" through legislation to address data protection and citizens' privacy concerns.

With the European Union already preparing to enforce its General Data Protection Regulation next year, India may be late to the party. But the need for a data protection and privacy law in India is pressing. And when it's enacted, it will define provisions for protecting sensitive personally identifiable information and spell out liabilities in the event PII gets breached.

Many security practitioners, however, say the government's goal of having a law by October seems aggressive.

Shivangi Nadkarni, co-founder & CEO at Arrka Consulting, points out that once the government publishes a draft regulation for public comment, it must allow two months for gathering feedback. "It has to align with the schedule of the Monsoon Session of Parliament if it has to meet the October deadline," Nadkarni says (see: It's Time to get Serious About Privacy).

Existing Provisions

India already has some data protection and privacy provisions in the Information Technology Act 2000, amended in 2008 and the subsequent IT rules defined in 2011. But the IT Act 2000/8 doesn't define sensitive personal information directly and only provides guidance for reasonable security practice and due diligence - the actual implementation standards have not been explicitly prescribed, says Bengaluru-based Na. Vijayashankar, a cyber law expert and information risk consultant.

The current data protection regime is under section 43A of the IT Act 2000/8, and the regulations made thereunder, says Pranesh Prakash, policy director at Bengaluru-based research think tank the Center for Internet and Society. He contends those regulations are weak, do not specify any governmental agency, and do not lay out penalties for violations. Other relevant provisions, such as section 72A, are also far too onerous and aren't ever applied in practice to such cases, he says (see: Pavan Duggal on Why India's Cyberlaw Must Rapidly Evolve).

"Section 43A and the 'reasonable security rules' didn't change much, given the lack of teeth in the regulations, and the onerous job of proving "wrongful gain or wrongful loss" of property due to data breaches," Prakash says. In addition, as a complement to a strong, yet flexible, data protection/data security regime, the government also needs to put in a privacy regime that covers both the private and public sectors, he adds.

Right to Privacy

India lacks a clear framework that categorically recognizes the sanctity of privacy, says J. Sai Deepak, an independent cyber law expert and arguing counsel at the Delhi High Court. Because the status of the fundamental right to privacy is yet to be adjudicated upon by the Supreme Court, Sai Deepak is uncertain of the basis on which the regulatory mechanism that the government is developing, would function (see: Why India Needs Comprehensive Privacy Law).

"This is important because if you treat privacy as a fundamental right, then the mechanism has to take into account the constitutional obligations and limitations that come with such treatment," Sai Deepak says. A telecom-centric or a single sector-centric approach to privacy as a reaction to a particular litigation may do more harm than good, he adds (see: Re-Evaluating Privacy in India).

"I hope the government goes beyond this context and addresses privacy comprehensively. It is for this reason that I am not sure TRAI is the best entity to vest this mandate with," he says. "After all, we are looking at safeguarding privacy even outside the telecom sphere" he adds.

The government needs to clearly spell out all principles and rights of individuals in the context of privacy as a foundation, experts say.

"Declare that privacy is a right of an Indian citizen and is protected by law," Vijayashankar says. The law should apply to protection of data in any form and require appropriate security measures to be adopted by anyone who collects, processes and manages PII, he adds (see: Privacy: Why India Inc. Needs It).

Viable Roadmap

Vinayak Godse, senior director at Data Security Council of India, says Indian companies, including IT services and outsourcing firms, are losing in European markets because of the high data protection standards followed in those countries.

"We have already been struggling in some markets as our data protection mechanisms don't match to the evolving global expectations for privacy," Godse says. "Questions have been raised by several geographies especially EU on India's regulatory posture in terms of data protection." (See: India's 2015 Data Privacy Agenda)

Vijayashankar says India needs to immediately appoint a data commissioner to efficiently address data privacy violations, which are currently being judged under ITA 2000/8. This will also help Indian enterprises that conduct business with the EU when the GDPR is enforced starting May 25, 2018 (see: How Will Europe's GDPR Affect Businesses Worldwide?).

Nadkarni of Arrka says the framework should:

• Clearly define and articulate what qualifies a personal information.
• Clearly spell out all principles and rights of individuals in the context of privacy and elaborate on specific aspects as required within each principle/ right.

The Justice AP Shah committee report of 2012 which proposed comprehensive set of data privacy principles and measures had a wide acceptance by various stakeholders, and should be a good starting point to draft an omnibus data privacy law in India, says Srinivas Poosarla, vice president and head (global), privacy & data protection at Infosys.

While the way the enforcement of any such law enacted, would differ at the center and at state level, some of the areas that Poosarla contends need attention are:

• Mandating that organizations appoint data privacy officers;
• Providing platforms to report grievances and receive compensation from organizations in a timely manner;
• Ensuring accountability of organizations for data privacy and to have them promptly report any data breach to affected individuals where there is likely to be material impact;
• Identifying and empowering a body at national or state level to enforce implementation of the law.

GDPR as a Model

Nadkarni suggests that the EU's GDPR would be a good benchmark for India. Poosarla and others also agree that the EU GDPR is a good template to draw from. Most importantly, the government should involve all stakeholders, especially privacy and data security advocates, in the drafting of the law, they say.

The best practices and principles from GDPR should be adopted, keeping the cultural and demographic needs of Indian society in mind, Vijayshankar adds.

Prakash of CIS notes: "Any law must keep the evolution of technology in mind. The law can't be so rigid that technological developments are prevented, nor can it be so flexible that technology defeats the basic guarantees provided by the law. For instance, the role of "consent" in a world where indefinite consent is easily obtained by inserting a clause in a long standard-form contract that no one reads, must be taken into account."